Canada Releases New AML Regulations For Crypto-Related Businessesbr>
The Canadian government has released its final anti-money laundering (AML) regulations, which will impact crypto-related businesses in the country.
Finalized late last month, the new regulations aims to address and close the gaps that exist in Canada’s AML/ATF Regime, including regulating new business models and technologies and addressing new emerging risks. Under the new regulations, both domestic and foreign crypto exchanges will be classified as money servicing businesses (MSB), which means they must register with the Financial Transactions and Reports Analysis Centre of Canada (FinTRAC) to operate. The new regulations will come into force on June 1, 2020.
“As required of all MSBs, persons and entities dealing in virtual currencies would need to fulfill all obligations, including implementing a full compliance program and registering with FINTRAC,” the government said. “In addition, any reporting entity in any sector that receives C$10,000 or more in virtual currency (e.g. receiving deposits, any form of payment) would have record keeping, identification and reporting obligations.”
According to the government, the amendments serve to mitigate the money laundering and terrorist activity financing vulnerabilities of cryptocurrency in a way that is consistent with the existing legal framework, while not unduly hindering innovation.
“The amendments are targeted at persons or entities engaged in the business of dealing in virtual currencies, and not virtual currencies themselves,” the government said.
Commenting on the new regulations, Moe Adham, CEO of blockchain startup Bitaccess, said that the new requirements could result in crypto exchanges opting to exit from the country.
“I expect to see a number of firms relocate outside of Canada, as well as international firms limiting access to Canadians,” Adham said.