Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Category Archives: Blockchain, Crypto, Digital Assets Regulations
Amazon and Walmart Exploring Merchant-Led Stablecoins
Stablecoins | June 17, 2025
Image: Freepik/rawpixel.com
Retail Giants Could Cut Card Networks by Issuing Their Own Crypto
Retail giants Amazon and Walmart are exploring the idea of launching their own stablecoins to reduce payment processing costs and gain more control over transactions, according to a report by the Wall Street Journal. This could tip the balance toward merchant-controlled financial systems and impact how value is transferred in the digital economy.
See: Shopify, Coinbase, Stripe to Take USDC Payments Mainstream
Currently card networks like Visa and Mastercard charge merchants high fees for purchase transactions. By using stablecoins pegged to the U.S. dollar, retail companies like Amazon and Walmart could build their own payment systems, bypassing legacy rails and retain more transactional value on their platforms. However any stablecoin plans depend on whether or not the proposed Genius Act becomes law in the United States.
Merchant-Led Stablecoin Payment Rails
As reported by Reuters, stablecoins are gaining interest among corporations that want to issue or use private forms of digital cash. The goal isn't to create a new form of money, but to develop closed financial ecosystem for transactions that are faster, cheaper, and programmable than legacy payment systems used today.
Retailers aren't the only ones interested. PayPal has already launched its own stablecoin, PYUSD, which is issued through a partnership with Paxos, a licensed trust company. Amazon and Walmart could follow a similar route or choose to build in-house capabilities.
According to Crowdfund Insider, the Genius Act is currently in front of the Senate and is expected to have a floor vote on June 18 which if passed would become the first American law to set national standards for fiat-backed digital currency. Stablecoins would require 1:1 reserve backing, clear audit rules, and strong consumer protections.
Policy Considerations
The Genius Act is designed to add clarity and prevent abuse while encouraging legitimate innovation. Only regulated entities can issue stablecoins and limits will be in place for the type or size of non-financial companies that can use them. Analysts at Bernstein have warned that the Genius Act could make it “prohibitive” for retailers to issue stablecoins directly without working with financial partners.
See: Stablecoin Payments Have Wings – Are You Ready?
As Business Insider explains, the bill would give federal regulators oversight of reserves, mandate asset freezes under court orders, and block big tech companies from embedding coins too deeply into their platforms. The law also prevents stablecoin issuers from tying coins to commercial loyalty programs or e-commerce activity without approval.
Implications for Fintech
If Amazon and Walmart did in fact launch their own stablecoins, merchant-led payment systems could reduce friction for consumers and suppliers while creating competitive pressure on Canadian banks, fintechs, and card networks.
Global payment flows could also be affected if retailer stablecoins are used for remittances or global vendor payments. Walmart already has a fintech joint venture with Ribbit Capital in the United States to create a fintech startup Hazel (also called 'One'), and experience with blockchain patents. Amazon has explored using external stablecoins such as USDC for settlement.
Whether they issue directly or partner with licensed issuers, the genie is almost out of the bottle and moving beyond theoretical. Consider it a live business option just waiting for regulatory clarity.
Why It Matters for Canada
Canada’s fintech ecosystem should monitor these developments closely. U.S. regulatory clarity could prompt other jurisdictions to act, and consumer expectations will grow as giant retailers redefine what payments in the near future look like.
See: SEC Clears Crypto Staking. What It Means for Canada
It may create opportunities for Canadian fintechs to partner with global brands or expand the merchant-focused rails to compete with card-based infrastructure, ultimately pushing to modernize domestic payments. Stablecoins come with some real risks around consumer protection, monetary policy, and financial stability, so it's essential to get the balance right.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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SEC Considers DeFi With Innovation Safe Harbour
Crypto Policy | June 11, 2025
Image: June 9, 2025 DeFi Crypto Roundtable (Coindesk via youtube)
Atkins and Peirce Back Safe Harbour and Rule Updates to Grow DeFi Responsibly
On June 9, the U.S. Securities and Exchange Commission (SEC) hosted another crypto task force roundtable series session called, "DeFi and the American Spirit", bringing together together regulators, legal experts, DeFi protocol developers, and investors to discuss how to the potential of regulating decentralized financial systems in ways that protects users without stifling innovation.
See: Bitcoin’s Evolving: The Rise of DeFi on Bitcoin
From the get-go, Chair Paul Atkins set the tone by opening the event by clearly stating that publishing code should not be treated as a crime:
“We will not regulate the act of writing open-source software. We do not prosecute the author of a hammer manual when someone misuses a hammer.”
The rest of the session built on this idea and focused on how the SEC can provide safe ways for DeFi projects to operate legally while still addressing investor risks.
Key Takeaways
1. SEC is Evaluating a New Pathway for DeFi Innovation and Compliance
In his remarks, Chair Atkins introduced the idea of a “conditional exemptive relief framework” which would allow DeFi innovators to build and launch on-chain products under limited conditions without triggering enforcement right away. This type of framework is similar to a regulatory sandbox that provides time-bound relief as long as participants meet specific safeguards.
“We are exploring a conditional exemptive relief framework that would allow experimentation under defined boundaries, similar to an innovation safe harbor.”
See: SEC Clears Crypto Staking. What It Means for Canada
Commissioner Hester Peirce (aka Crypto mom) echoed this sentiment saying without a structured pathways to compliance, many innovators will either operate in legal uncertainty or offshore their projects out of the United States.
“Without a clear, conditional pathway, we are telling innovators you are on your own. That is not a message we want to send if we value the benefits of decentralized systems.”
2. SEC to Modernize Existing Rules for On-Chain Finance
In addition to the DeFi safe harbour, Chair Atkins also called upon his staff to modernize the current SEC rules to accommodate traditional issuers and intermediaries who want to use on-chain infrastructure.
See: Crypto.com Canada Gains Canadian Regulatory Approval
This move shows that the SEC is looking to facilitate both new DeFi entrants and existing market players who are building tokenized products or using smart contracts to manage trading, issuance, or custody.
“I have asked the staff to consider whether amendments to the Commission’s rules and regulations would be better suited to provide needed accommodation for issuers and intermediaries who seek to administer on-chain financial systems.”
3. Acknowledging efficiency, liquidity, and new financial instruments
Atkins also discussed that on-chain systems can bring real benefits to the market, such as lower transaction costs, faster settlement, broader access, and the ability to create entirely new asset classes.
“I also am excited about the use of on-chain software systems by issuers and intermediaries to eliminate economic frictions, increase capital efficiency, enable new types of financial products, and enhance liquidity.”
See: New AI Minister Prioritizes Growth Over Rules
It's clear support and endorsement of blockchain as a tool for economic growth, not just a solution for compliance challenges.
4. Off-chain risks are growing and need better disclosure
Several panelists, including Rebecca Rettig of Polygon Labs, warned that some of the most serious risks in DeFi happen off-chain. These include hidden liquidity deals, token allocations to insiders, or governance control partnerships.
“It is not always what is on-chain that creates the risk. It is often what is not disclosed, like side agreements, control over governance tokens, or preferential liquidity deals.”
Panelists argued that DeFi projects need better disclosure on how protocols are governed, how tokens are distributed, and whether any third parties receive special treatment or not.
5. Rules should follow activity, not labels
Legal and industry experts said regulators should stop focusing on whether a token is a security and start regulating based on what the product or service actually does.
See: UK Publishes Draft Rules for Crypto Regulation
Angela Angelovska-Wilson of DLx Law said:
“We waste enormous energy litigating over whether X token is a security. The better path is regulating the activity, such as staking, custody, or lending, regardless of the label.”
Michael Jordan of the Digital Dollar Foundation agreed, saying:
“If we regulate the technology, someone will build around it. If we regulate the activity, we have a chance at real consumer protection.”
Important to understand the growing consensus that rules should distinguish between different types of financial behaviour even when the technology is similar.
6. Not all interfaces are equal under the law
Josh Garcia of Ketsal pointed out that some interfaces like custodial front ends that take custody of user funds or routes trades on behalf of users may require stricter oversight whereas protocols without admin control may require lighter regulation. Advocating for a layered regulatory approach that differentiates on function and control.
See: Takeaways from the SEC’s Crypto Custody Roundtable
“A protocol with no privileged admin keys is not the same as a custodial front end that routes retail funds. The obligations differ, and so should the rules.”
Outlook
After several Crypto Task force roundtable sessions, the SEC and participants are finally getting on the same page while focusing on conditional exemptions, regulatory modernization, and functional oversight. All together, it's a series effort to balance investor protection with lawful DeFi innovation. For fintech founders and digital asset platforms in Canada and globally, it's an important benchmark. If the U.S. begins providing clear compliance pathways and policy support for tokenized systems, then other jurisdictions will need to keep up or risk flight of builders and capital.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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SEC to Host Policy Roundtable with DeFi Builders
DeFi Policy | June 5, 2025
Image: Freepik/rawpixel.com
SEC Invites DeFi Builders and Experts to Discuss Future Policy
On June 9, the U.S. Securities and Exchange Commission is hosting a policy roundtable titled “DeFi and the American Spirit” to have an open and structured policy dialogue with decentralized finance developers, innovators, and legal experts alongside SEC legal and regulatory voices. The roundtable is part of the SEC's Crypto Task Force's ongoing series of crypto asset regulation events.
See: DeFi Technologies Begins Nasdaq Trading in Global Expansion
These gatherings are not 'hearings', nor are they 'policy announcements' but rather conversations with people who have actually built defi systems, in fact many who have publicly challenged the SEC's approach. It’s a live forum where ideas about risk, innovation, and policy design can be tested in real time. So in that way, it's a rare and important event for DeFi in the U.S. and fintechs watching from other jurisdictions like Canada.
Speakers Set the Tone
The speaker lineup is a mix of founders, researchers, lawyers, and advocates who all have somewhat different views on how DeFi should work and be handled from a regulatory and practical perspective.
Erik Voorhees, founder of ShapeShift (and now Venice AI) is known for arguing that decentralized tools and open-source software should not be regulated like traditional financial intermediaries. His participation ensures that the case for user autonomy and protocol neutrality will be represented without compromise.
Michael Mosier, former acting director of FinCEN who founded Arktouros is focused on financial crime and compliance. He's likely to advocate for more robust frameworks for identifying illegal flows through permissionless systems. He'll ensure that AML and systemic risk questions are part of the core conversation.
See: Takeaways from the SEC’s Crypto Custody Roundtable
Rebecca Rettig, general counsel at Jito Labs and formerly with Polygon, brings first-hand experience in understanding protocol development and legal structure, and is well positioned to bring up solutions that don’t rely on full centralization, such as voluntary disclosures or protocol guardrails.
Kevin Werbach, a professor at Wharton, has spent years studying how decentralized systems intersect with regulation. He tends to advocate for layered frameworks that separate software, governance, and commercial activity to provide a way to regulate outcomes without halting innovation.
There are several other panelists including Jill Gunter (Espresso Systems), Peter Van Valkenburgh (Coin Center), Omid Malekan (Columbia Business School), Gabe Shapiro (MetaLeX), and others who will no doubt have ample to contribute in helping the SEC understand as well as framing the policy of decentralized systems.
It’s a great cross-section of people trying to answer the same question from different angles: how should decentralized finance be understood and governed?
What Might Emerge From the Discussion
Here are some core questions that may come up during the discussions:
See: UK Publishes Draft Rules for Crypto Regulation
- Whether front-end operators or governance token holders can be held responsible for protocol-level activity
- Whether full KYC/AML is even feasible in trustless systems, or whether alternative risk controls could satisfy regulatory goals
- Whether decentralized protocols should have a path to safe harbour status if they meet transparency or auditability benchmarks
- How to separate expressive code from financial intermediation in a way that holds up in court
At the end of the day, the SEC should be commended for their willingness to engage with key foundational questions in effort to both understand at a deeper level, as well as inform future policy making. Leaps and bounds better than regulate by enforcement under the SEC's ex-Chair, Gary Gensler and a commission that would rather assume that every DeFi project is either a rug-pull or disguised as a securities platform.
Implications for Canadian Fintech
If the roundtable opens the door to more flexible or fit-for-purpose regulation, Canadian regulators will face growing calls to follow suit. It also offers Canadian founders a window into how U.S. regulators are thinking, what they are worried about, what they may be willing to tolerate, and where they are open to compromise. It's clear proof that the SEC is finally recognizing that DeFi isn't going away and that series policy design needs inputs from the people building it.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Russia’s State Bank Launches Bitcoin-Linked Bond
Crypto | June 2 ,2025
Image: Freepik/bearfotos
Sberbank’s New Bond Offers Ruble-based Bitcoin Exposure to Approved Investors Inside Russia
On June 2, 2025, as reported by Coindesk, Sberbank, Russia’s largest and majority state-owned bank, quietly launched a structured bond tied to the performance of Bitcoin and the US dollar against the ruble. The bond is the first financial product of its kind in Russia to offer legal, state-backed exposure to cryptocurrency without requiring investors to hold or trade Bitcoin directly.
See: Russia Pivot’s on Crypto as BRICS Momentum Builds
The bond is only accessible by qualified investors in Russia and is offered over the counter. It's designed to deliver returns (1) if Bitcoin rises in value, or (2) if the US dollar gains strength against the ruble. In doing so, investors can potentially receive higher yields than standard fixed income products within Russia's domestic financial system.
Russia's Approach to Digital Assets
The bond is the first major financial product under new Bank of Russia rules that allow crypto-linked investments for qualified investors. For years Russia maintained a strict stance against cryptocurrencies, banning most forms of trading and prohibiting retail access to digital assets. Even after the rule change, everyday investors are not allowed to buy or sell digital assets through local exchanges or banks.
Will Sberbank's new bond change the landscape? Well it shows that Russia is willing to allow certain investors crypto exposure but only if it can fully control participation and on its own terms. Since the bond's settlement is in rubles and all transactions are managed/controlled by a government-backed institution, Russia can offer these types of investment options without stressing capital controls or monetary policy.
See: Strategy Buys More BTC as Canadian Crypto ETFs Grow
Sberbank also announced that it plans to list crypto-linked instruments on the Moscow Exchange. A Bitcoin futures product is expected to go live through its SberInvestments platform on June 4, 2025. These moves are all part of a broader push to establish legal, regulated channels for digital asset exposure inside the Russian economy.
Limited Access, Uncertain Demand
As of today, there is no official data on the uptake or demand of the new bond issuance. Given that the product is new and restricted to accredited investors, detailed information may not be released until trading volumes develop. While the bond's dual exposure to Bitcoin price movements and to the USD/RUB forex rate, introduces volatility but institutional investors are looking for returns beyond traditional instruments, and the new bond option arrives at time when crypto adoption and exposure continues to grow globally.
Why This Bond Matters
Prior to now, most Russian investors looking for crypto exposure have relied on offshore accounts, informal P2P markets, or restricted access to foreign exchanges. All of these pathways come with geopolitical, legal and financial risks and challenges. Western sanctions, domestic regulations, and banking restrictions make cross-border crypto activity increasingly difficult.
See: SEC Clears Crypto Staking. What It Means for Canada
Sberbank’s bond changes the equation. For the first time, investors can gain access to Bitcoin-based returns through a compliant, state backed product inside the Russian system. No private wallets are needed. No foreign currency leaves the country. The bond is fully backed by a government aligned financial institution and built to comply with Russian regulations. Sberbank’s bond may become a model for how other emerging markets experiment with digital assets while retaining full oversight and domestic control.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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SEC Clears Crypto Staking. What It Means for Canada
Crypto Regulation | June 2, 2025
AI Image, SEC says crypto staking not a security
SEC Says Crypto Staking is Not A Securities Offering. Canada May Feel Pressure to Respond.
On May 29, 2025, the U.S. Securities and Exchange Commission (SEC) published new guidance, "Statement on certain protocol staking activities". The Corporation Finance Division said that staking crypto assets on proof-of-stake networks does not count as offering or selling a security under federal law.
The SEC guidance says these 3 models do not involve the kind of for profit structure that securities law covers, which shows how the SEC is now approaching proof-of-stake blockchain systems in practice: (1) staking by individuals (solo staking), (2) delegating staking rights to a non-custodial third party, and (3) custodial staking done by platforms that hold assets on behalf of users.
See: Canada Launches First Spot Solana ETFs With Staking
The Division stated, “Protocol staking does not involve entrepreneurial or managerial efforts by third parties." Meaning it does not meet the Howey Test which the SEC uses to determine what counts as an investment contract (or not).
Main Takeaways
- The SEC found that staking does not involve an expectation of profit based on others’ business efforts. Instead, rewards come from doing a technical job on the network. Staking is not an investment contract.
- If you run your own node or delegate your staking rights to another operator, this activity is not seen as a securities offering.
- Platforms can stake customer assets if those assets are not loaned, traded, or otherwise reused. Rewards must come from the protocol, not from the custodian.
- Features like early withdrawals, reward smoothing, and risk protection are considered administrative, and do not turn staking into a regulated activity.
- The SEC's approach offers a cleaner regulatory environment for staking models in the U.S. with guidance. So it removes core legal risks that have held back innovation and participation for years.
SEC Commissioners Split
Two SEC commissioners published separate statements that highlight the ongoing debate inside the agency.
Commissioner Hester Peirce (Crypto mom) supports the new staking guidance, saying it was long overdue and provides clarity that developers and users have been asking for:
“Today’s statement is a step in the right direction. Market participants have long sought guidance on staking, and this statement, although overdue, provides helpful clarity.”
“Staking is not a financial investment in a business venture. It is a technical function essential to many blockchain networks.”
Commissioner Caroline Crenshaw raised concerns over the staking guidance, warning that it may weaken protections for retail users and was issued without a formal public process.
“This Staff statement attempts to draw lines in a complex and evolving ecosystem without the benefit of a Commission vote or notice and comment. That is not the kind of transparency or rigor that investors or market participants deserve.”
Crenshaw also said staking programs can still involve risk, especially when intermediaries are holding customer assets.
“Even assuming the best of intentions, staking programs can pose meaningful risks, especially when intermediaries custody or manage assets.”
What This Means for Canada
Canadian regulators already have clear guidance on when staking may fall under securities law. According to CSA Staff Notice 81-336, the key trigger is custody. If a platform takes control of client crypto assets and stakes them on the client’s behalf, this may be considered a securities or derivatives activity and could require registration or compliance under existing rules.
See: OSC Opens Door for Tokenized Long-Term Funds
However by contrast, individuals who stake their own crypto assets directly or delegate staking rights without giving up custody are generally not subject to regulation, as long as the activity does not involve other investment features or representations.
“Depending on how it is conducted, staking of crypto assets may involve the issuance of a security or derivative and/or may raise other investor protection concerns.”
The U.S. position is different becomes it frames protocol staking itself as a technical service (even when done by custodians), and not an investment contract. At the end of the day, U.S. firms will now face less friction when offering staking services, while Canadian platforms still operate under stricter conditions if custody is involved.
The question now is whether Canada will maintain this more cautious approach or align with emerging U.S. standards. If many firms start moving operations to the U.S. to take advantage of fewer barriers, then regulators may feel pressure to change.
Guidance Is Informal and May Not Limit Legal Risk
Be aware that the guidance reflects the views of the SEC's Corporate Finance Division staff. It's not a new law or exempt from any activity from enforcement but it does offer helpful insight into current staff interpretations under existing U.S securities law (but it's not binding or the full Commission or court). It was raised that some common staking features like pooled assets, slashing protection, or enhanced reward mechanisms could till meet the criteria for an investment contract under Howey.
Further, the staff statement doesn't include liquid staking, restaking, or other models that add financial structuring, which is outside the scope of the guidance and could still raise regulatory concerns. See this A&O Shearman article for deeper analysis.
Why It Matters
Staking is one of the core functions of proof-of-stake blockchains, including Ethereum. For developers and users, the ability to stake without regulatory risk is essential to network growth and security.
See: Crypto.com Canada Gains Canadian Regulatory Approval
The SEC's staking guidance removes barriers, adds clarity, and will certainly give the market a boost. It will be interesting to see if staking adoption is slower here in Canada and if domestic platforms can compete or are overly restricted, due to the different approaches.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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OSC Opens Door for Tokenized Long-Term Funds
Capital Markets | May 30, 2025
Image: Freepik/rawpixel.com
New Fund Model Could Bring Tokenized Infrastructure to Retail Investors
The Ontario Securities Commission (OSC) LaunchPad announced on May 29, 2025, that they are establishing the groundwork for a new generation of investment products for retail investor access. The focus is on long term asset exposure for everyday investors, which could very well include an innovative structure like tokenized funds.
See: What the 2025 Throne Speech Means for Fintech and Growth
The OSC’s “Long-Term Asset Fund Project” is supporting the development of investment fund products that offer retail exposure to traditionally inaccessible assets classes, such as venture capital, private equity, private credit, infrastructure, and natural resources (mining, forestry, energy etc). The regulator is calling on industry stakeholders to propose fund models that may require exemptive relief, while maintaining investor protection measures.
Grant Vingoe, CEO OSC:
“The investment landscape is shifting, and retail investors are increasingly looking to diversify their portfolios. The LaunchPad project is supporting new and innovative financial products that can enhance market efficiency and provide new opportunities for investors.”
Opportunity for Tokenization Fund
The OSC’s focus on alternative assets and flexible fund design makes this particularly relevant for blockchain-based tokenized funds. Tokenization is the issuance of fund units as digital securities on a blockchain, with programmable compliance, transparent ownership records, and fractional investment opportunities for retail investors.
See: OSC Green Lights Kraken’s Restricted Dealer Status
A tokenized OLTF (Ontario Long-Term Asset Fund) model could take the form of a closed-end or interval fund:
- Uses smart contracts to manage redemptions, enforce eligibility rules, and automate reporting
- Onboarding and compliance functions like KYC and investor accreditation can be embedded directly into the token issuance and transfer process
- This structure reduces administrative burden while improving oversight, still a key priority for regulators
From an investor standpoint, tokenization makes it easier to own smaller, fractional interests in long-term projects such as clean energy infrastructure, real estate developments, or later stage venture funds. Guardrails can be built-in to manage liquidity, restrict transfers, and redemption windows that match the underlying assets.
Outlook
This is a signal and actionable opportunity for regulated digital asset investment in Canada. Unlike typical sandbox programs, this LaunchPad effort is tied directly to new product implementation and could be a key opportunity to bring real retail access for tokenized long-term assets to Canada. The OSC will evaluate proposed exemptive relief frameworks.
See: Responding to U.S. Financial Risk with Canadian Strength
Done right, a tokenized fund for long term assets could capitalize intensive projects that fuel economic growth while providing retail investors a chance to participate. NCFA members can get in touch with the LaunchPad initiative to discuss: mtang@osc.gov.on.ca.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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GENIUS Act Advances as Bitcoin Hits Record High
Digital Assets | May 22, 2025
Image: Freepik
U.S. Stablecoin Bill Gains Traction as Bitcoin Hits New All Time High
Various sources have reported that the U.S. Senate has now approved the GENIUS Act to move forward, which is the proposed law that sets out national rules for the issuance of stablecoins and how they would be backed and managed in the U.S. Stablecoin adoption has been on fire recently, as they are increasingly used for crypto trading, cross-border payments, and digital services.
Only a couple of weeks ago on May 8, 2025, the GENIUS Act failed to clear a procedural vote in the Senate, receiving only 49 votes of the 60 needed to move forward, largely over Democrat conflict of interest concerns involving President Trump's family and their growing crypto ventures, including USD1 stablecoin backed by World Liberty Financial.
At the same time, Bitcoin just surged past $111,000 on May 21, reaching a new all-time-high (ATH), a clear signal of how fast the digital asset world is growing and that clear rules are needed.
Stablecoin Regulation Advances
Fifteen Democrats joined Republicans, showing rare bipartisan alignment with the U.S. Senate approving the GENIUS Act in a 66–32 vote, allowing it to move to a full vote soon where lawmakers may combine it with other similar proposals before sending it to the President for review and sign-off. Support from both major parties indicates a strong chance that the GENIUS Act will eventually become law.
A recent Congressional Research Service report also outlines how the bill could reshape the stablecoin landscape, clarifying rules around issuance, reserve backing, and oversight.
Under the GENIUS Act, only licensed banks, approved non-banks, and qualified state level issuers can offer stablecoins to people in the U.S., which is designed to help keep out unregulated or risky issuers.
See: U.S. Senate Moves to Regulate Stablecoins
The bill also requires stablecoins to be backed 1-1 by U.S. dollars or very liquid assets. Issuers would have to publish monthly updates showing what backs their coins and clearly explain how people can redeem them. Companies outside the U.S. would need approval from the Treasury and proof that they meet requirments and can follow similar rules.
Crypto and AI advisor to the President, David Sacks, said the GENIUS Act could “create trillions of dollars of demand for U.S. Treasuries practically overnight.” He is positioning stablecoins as a national economic strategy, not just about digital innovation. The White House has strongly backed the bill, although some Democrats remain concerned about conflicts of interest tied to President Trump’s family’s involvement in crypto.
Digital Assets Heating Up
Bitcoin’s latest surge puts digital assets back in the spotlight, and with more people using stablecoins and Bitcoin ATMs, regulators want to make sure these services are safe and clearly regulated. The GENIUS Act is one way to respond to this fast growth.
See: Fidelity Report Insights on Digital Assets in 2025
Other countries are moving quickly, too. Jurisdictions like the EU, UAE, and Singapore are building their own stablecoin frameworks. If the U.S. experiences further delays, it could risk losing ground in establishing the global standard and leadership role in digital assets.
Conclusion
The GENIUS Act would reduce uncertainty and make it easier for fintechs and investors to innovate in digital asset markets while establishing a foundation for a safer and more trusted digital asset financial ecosystem.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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