The Canadian Securities Administrators (CSA) has urged Canadians to be cautious when considering buying crypto assets through trading platforms.
In an investor alert published on Wednesday, the CSA warned investors about the lack of oversight and investor protection that accompanies trading in crypto assets.
“Investors should be cautious when dealing with any crypto-asset trading platform,” the CSA stated.
There are no crypto-asset trading platforms that are recognized as an exchange, or authorized to operate as a marketplace or dealer in Canada, regulators stressed in the alert.
Given that these platforms are not regulated, critical investor protections — such as requirements for handling client funds, processes for pricing and trading crypto assets, disclosure obligations, and rules against market manipulation and other forms of misconduct — aren’t in place either.
“Investors should be cautious when dealing with any crypto-asset trading platform,” the CSA stated.
“We want investors to understand that just because a platform may advertise itself as an exchange, that does not mean the platform is complying with applicable securities regulations,” said Louis Morisset, chairman of the CSA and president and CEO of the Autorité des marchés financiers (AMF), in a statement.