A long-anticipated report published by the Canadian Standing Senate Committee on Banking, Trade and Commerce has called for a “regulatory light touch” on bitcoin and digital currencies.
The report, entitled “Digital Currency: You Can’t Flip This Coin!”, comes after a months-long review that included a number of hearings before the Senate committee, and will undoubtedly play a role in how the Canadian government shapes future regulation.
The committee recommended that the government look for ways to utilize digital currencies and blockchain technology, deeming the technology “ingenious” and capable of potentially meeting critical needs in both the financial sector and the unbanked in the world.
The report stated:
“The federal government [should], in considering any legislation, regulation and policies, create an environment that fosters innovation for digital currencies and their associated technologies. As such, the government should exercise a regulatory “light touch” that minimizes actions that might stifle the development of these new technologies.”
The committee also recommended that the government work with other countries on regulatory frameworks that offer a balanced approach to oversight, provide publicly available information on the legal and tax implications of digital currencies, and conduct further reviews of the study’s findings over the next three years.
Notably, the committee recommended that Canadian digital currency exchanges be subject to money transmission regulations, but that companies that solely offer wallet services in Canada should not fall under that classification.
The report cited money laundering, terrorist financing and price volatility as “serious obstacles” for the government as digital currency regulation is considered.
The full Canadian Standing Senate Committee on Banking, Trade and Commerce report can be found below:
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