One of Canada’s provincial regulators, the British Columbia Securities Commission (BCSC), has granted blockchain startup First Block Capital Inc. its official registration as an investment fund manager, which allows the firm to operate a Bitcoin investment fund.
Following a review of the First Block Capital application, the BCSC determined that this company complies with the necessary regulations under the securities law requirements. Upon request, First Block Capital was also granted an exemption from complying with certain regulations as a market dealer.
Earlier in July, First Block Capital launched the first Canadian Bitcoin trust, which provided eligible investors with a convenient way to invest in Bitcoin. The fund enables investors to get exposure to the price of Bitcoin without having to worry about buying and securing the cryptocurrency.
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The Canadian Securities Administrators (CSA), comprised of the country’s thirteen key financial market regulators across their respective provinces, has recently announced plans to regulate initial coin offerings (ICOs), or token sales.
The CSA stated that this new fundraising phenomenon should be categorised as securities, at least in some cases. This implies that certain ICOs/ITOs would now need to follow Canadian securities laws, which requires assessing the economic realities of the offering to protect participating investors.
Zach Masum, the leader of the BCSC’s Tech Team, commented: “Cryptocurrency investments are a new and novel form of investing in Canada. We have seen from the market and from investors that there is a strong appetite for access to these kinds of investments. This first registration allows access to bitcoin investments, while providing the BCSC with unique mechanisms to monitor operations in a rapidly developing area.”
He added: “We strongly encourage other companies in British Columbia, whether they are potential new registrants or existing investment fund managers, to contact the BCSC’s Tech Team if they are considering pursuing cryptocurrency investments in their funds. The Tech Team can help ensure compliance with securities regulation, which can help save time and potential costs later on.”
The BCSC is the independent provincial government agency responsible for regulating securities trading in British Columbia through the administration of the Securities Act. The regulator’s website provides information, tools and resources for investors, including investor warnings about individuals and companies that appear to be engaging in unauthorized activities.