As cryptocurrency has grown in popularity, crypto-related crimes have also been on the rise as Crypto Head showcased in its Crypto Crimes report earlier this year, which found that in 2020 there were 8,801 crypto crime reports to the UK action fraud team. 
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
Sep 23, 2021: CSA and IIROC Issue Joint Guidance (Staff Notice 21-330) for Crypto-Trading Platforms Related to Advertising and Social Media
CSA and IIROC | Staff | Sep 23, 2021
Staff notice 21-330 issued today - Select summary below:
Summary of securities legislation and IIROC Rules in relation to false or misleading advertising
A number of provisions in securities legislation and IIROC rules apply to prohibit false or misleading statements in advertising or marketing materials. These prohibitions can apply to the making of statements
- that suggest that a CTP [Crypto Trading Platform] is registered under securities legislation where this is not the case
- that suggest that a securities regulatory authority or regulator has approved or endorsed the CTP, any products offered on the CTP or any disclosure or other representation made by the CTP; or
- about any matter that a reasonable investor would consider relevant or important in deciding whether to enter into or maintain a trading or advising relationship with the CTP if the statement is untrue or omits information necessary to prevent the statement from being false or misleading in the circumstances in which it is made.
See: Crypto in Canada: Where are we today, and where are we heading?
In addition, registered CTPs should consider their advertising and marketing strategies in the context of their obligation to treat their clients fairly, honestly and in good faith under securities legislation and, if applicable, IIROC rules. Moreover, a registered CTP should consider how the advertising and marketing affects its obligations under Part 13 of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103) and, if applicable, equivalent requirements in IIROC rules relating to:
- know-your-client, know-your-product and assessing suitability, and
- identifying and responding to conflicts of interest in the best interest of the client.
Concerns over improper "gambling style" promotions and schemes
We have recently noted some CTPs using advertising or marketing strategies that include contests, promotions, bonuses and time-limits to encourage investors to engage in trading and to act quickly for fear of missing out on an investment opportunity or a reward. For example, a promotion involving a bonus scheme may offer a financial reward or a bonus interest in a particular type of crypto asset for the first 500 investors who take an action within the next 24 hours.
We are concerned that some of these strategies may inappropriately encourage investors to engage in excessively risky trading, taking on risks that they would normally avoid.
See: Crypto fraud and breaches on pace to exceed $3 billion in 2021
We wish to remind CTPs that registered dealers have an important role as gatekeepers of the integrity of the capital markets. They should not, by act or omission, engage in or facilitate conduct that brings the market into disrepute. Advertising and marketing strategies designed to encourage excessively risky trading may, depending on the circumstances, violate the registrant’s obligation to treat clients fairly, honestly and in good faith.
Compliance and supervisory expectations for firms using social media
We expect registered CTPs to consider compliance and supervision when using social media websites and platforms (social media sites) as a means of communicating with clients and the general public for business purposes. They must maintain records of their business activities, financial affairs and client transactions. The use of social media sites increases the risk that registered CTPs may not be retaining adequate records of their business activities and client communications. This is the result of interactive social media web sites that include the posting of both real time and static content. Registered CTPs must design systems that allow for compliant record retention as well as retrieval capability.
See: Decentralized Finance—Risks, Regulation, and the Road Ahead
The use of social media web sites is also challenging in terms of supervision, and CTPs must determine the level or extent of supervision necessary, particularly considering the provisions in securities legislation relating to the use of misleading and false statements. This may include the use of a risk-based approach to determine whether a CTP’s review of electronic communications is sufficient to meet its supervisory obligations. These supervisory obligations are not just restricted to social media use by the CTP but also by its directors, officers, employees, shareholders and other third-parties acting on behalf of the CTP.
View the joint staff notice 21-330 --> here
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, 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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[Brooking’s Event Sep 30]: Regulating cryptocurrencies and future technologies: A conversation with Manuel P. Alvarez
Brookings | Sep 22, 2021
Everyone is talking cryptocurrency, but what is crypto, how does it work, should it be regulated, and if so, how? How do investors decide to provide early support for new technologies, especially for financial technology, when so much is unknown? What future technologies can be seen on the horizon?
Thursday, September 30, 2021, 12:00 - 1:00 p.m. EDT
On Thursday, September 30, Brookings Nonresident Fellow Loni Mahanta will host Manuel P. Alvarez for a discussion of these questions and more on regulating new technologies now and in the future. Alvarez previously served as the commissioner of the California Department of Business Oversight, the state’s banking and financial regulatory agency, where he led the department in its transition to the Department of Financial Protection and Innovation and spearheaded its focus on protecting consumers from harmful practices, increasing access to financial literacy and technology, and engaging under-served communities. Alvarez also served as general counsel and chief compliance officer of Affirm, Inc., where he led the fintech company’s legal and regulatory compliance efforts.
Continue to the full article --> here
Register for this virtual event --> here
Noteworthy:
Former Commissioner of the California Department of Financial Protection and Innovation, Manuel P. Alvarez, Joins Binance.US
Leading digital asset marketplace Binance.US has recently announced that Manuel “Manny” P.Alvarez, who previously served as Commissioner of the California Department of Financial Protection and Innovation, would be joining their team as Chief Administrative Officer from July 22 onwards. As the Chief Administrative Officer, Alvarez will supervise the major control functions such as risk, compliance, and legal. More here
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, 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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Crypto fraud and breaches on pace to exceed $3 billion in 2021
The Fintech Times | | Sep 9, 2021
As cryptocurrency has grown in popularity, crypto-related crimes have also been on the rise as Crypto Head showcased in its Crypto Crimes report earlier this year, which found that in 2020 there were 8,801 crypto crime reports to the UK action fraud team.
This was a 24% increase from 2019, where 7,121 reports were filed. Prior to this, crypto crime reports in the UK had been growing exponentially. Between 2017 and 2018 there was a 355% surge in crypto-related crime, as there were over 5,000 more reports in one year alone.
In particular, the number of exchanges and currencies that are being targeted by hackers stealing coins has increased, as many crypto and blockchain technologies are still in their infancy so they can be more easily exploited. 8,131 of the crypto crimes reported to the UK action fraud team were related to Bitcoin crimes.
So, how have the number of crypto breaches and fraud offences changed over the last decade, which have been the biggest, and how do they vary between different countries and currencies?
See: CipherTrace August 2021 Crypto Crime Report: Crypto Fraud Dips as DeFi Hacks Grow
The largest crypto breach and fraud to date was the OneCoin Ponzi scheme ($4 billion), which was promoted as a new cryptocurrency and has been dubbed one of the biggest scams of all time. The founder, Ruja Ignatova, disappeared in 2017 and has yet to be found, although many others have been arrested in connection with the scheme and US authorities state that the scheme defrauded investors of $4billion.
Crypto breaches and fraud has increased significantly. Between 2011 and 2021 there have been 208 notable crypto offences, with a total of $19.2billion being stolen in that time. In 2011 there were nine offences, with over $9million being taken, but this number had almost doubled by 2013 and grew to as many as 38 in 2020 and 32 so far in 2021, showing how rapidly offences are increasing. While 2021 looks set to be the year with the highest number of offences, 2017 was the year that saw hackers make the most money, stealing highs of $4.7billion in total and $223.5million on average.
As hackers and their technology become more sophisticated, it’s clear that breaches are an increasingly big concern for the crypto world.
Image: Crypto Head / The Fintech Times
The most common types of crypto offence is breaches of wallets and exchanges, with 126 in the last ten years, which is far more than offences involving DeFi attacks and fraud (both 41). The largest of these breaches to date saw Mt. Gox have $615million stolen over the years, leading to the platform ultimately becoming insolvent in 2014.
See: InsurAce Founder at DeFi Insurance Protocol Explains the Difference between Traditional and Decentralized Insurance
However, it was cases of fraud that were the most lucrative for criminals, usually seeing the perpetrators walk away with big sums. The average crypto fraud incident saw $365million stolen (over 14 times as much as breaches), while just under $15billion has been stolen in total via fraud since 2011. However, the number of DeFi (decentralised finance) breaches is on the increase, with this new technology more open to potential weaknesses.
Continue to the full article --> here
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, 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 Oversight Hearing: SEC Chairman Grilled by Republicans on Senate Banking Committee
Crowdfund Insider | | Sep 15, 2021
SEC Chairman Gary Gensler marched up to Capitol Hill yesterday to testify in front of the Senate Banking Committee in a hearing entitled “Oversight of the U.S. Securities and Exchange Commission”. Gensler outlined his ambitions at the SEC in his prepared remarks.
While Gensler received relatively light questions from Democrat Committee members, Republicans took the opportunity to challenge the top securities regulator on several important policy issues.
Senator Sherrod Brown, Chairman of the Committee, focused his introductory comments on a financial system that has “catered to the big guys,” emphasizing the need for greater regulation while lambasting the actions of the last administration.
See: Top US regulator tells crypto exchanges they need to ‘come in and talk to us’
Ranking Member Senator Pat Toomey said there are numerous areas where they would agree but hammered Gensler’s statements on payment for order flow as the SEC has not “demonstrated any failure or harm associated with payment for order flow, which the SEC has allowed for years.”
Regarding cryptocurrency, an area that the SEC has struggled to regulate and craft bright-line rules, Toomey criticized Gensler once again for the Commission’s vague approach, a posture that has been bemoaned by industry participants.
“Based on your public statements, you believe that some are securities but others are not. So, I am frustrated by the lack of helpful SEC public guidance explaining how you make this distinction. What makes some of them securities and others not?” Toomey asked. “Why wait to make the SEC’s views known only when it swoops in with an enforcement action, in some cases years after the product was launched?”
While noting that the SEC is in the habit of providing private guidance to potential digital asset issuers and crypto firms, Toomey asked why Gensler and the SEC does not simply let their views be known and provide transparency to the emerging sector of Fintetch.
Regulation by enforcement will crush domestic innovation and, perhaps, compel Fintech innovators to move elsewhere. While supporting regulation when necessary, Toomey requested clarity from the SEC asking Gensler to publicly announce what characteristics make a crypto a security or not, asking the Chairman “why wait?”
Read: Decentralized Finance—Risks, Regulation, and the Road Ahead
During questioning, Gensler said that most cryptocurrencies are securities as they are investment contracts. Toomey asked if stablecoins are securities while stating he believes they are not. Gensler said he believes that stablecoins may be securities putting the entire sector in question.
Gensler said that current law has established a very broad definition of a security and “Congress can change that.”
Continue to the full article --> here
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, 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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Top US regulator tells crypto exchanges they need to ‘come in and talk to us’
Securities and Exchange Commission boss Gary Gensler has said crypto exchanges need to "come in and talk" to the markets regulator, just days after clashing with trading platform Coinbase over one of its products.
Gensler will appear before the Senate banking committee on Tuesday and used his prepared remarks to increase the pressure on crypto exchanges, which he has previously said he would like to regulate more closely.
See: Coinbase Threat Shows SEC Means Business
The SEC boss said exchanges need to register with the Commission, because some of their tokens or products may be securities. That's unlike bitcoin, which regulators think is more like a commodity.
Gensler said:
"I've suggested that platforms and projects come in and talk to us. Many platforms have dozens or hundreds of tokens on them. While each token's legal status depends on its own facts and circumstances, the probability is quite remote that, with 50, 100, or 1,000 tokens, any given platform has zero securities. Make no mistake: To the extent that there are securities on these trading platforms, under our laws, they have to register with the Commission unless they qualify for an exemption."
Gensler's strong statement comes after the SEC cracked down on Coinbase, threatening to sue the $64 billion crypto exchange if it went ahead with launching a digital asset lending product called Lend.
See: Moody’s says Crypto regulation a plus for banks, fintechs
Gensler has previously said that products that bear a specific interest-rate return could fall under SEC oversight as securities. And he has hinted some stablecoins could also feed into that category.
Yet some lawmakers and crypto-industry figures would like to see more action from the SEC in clarifying what it thinks it can, and can't, regulate.
Continue to the full article --> here
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, 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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Digital Euro Report: Design considerations facing the European Central Bank
Internet Economy Foundation | Clark Parsons | Sep 8, 2021
New Study Highlights the Key Design Choices Facing the European Central Bank and Makes Recommendations for Building an Innovation-Compatible Digital Euro
Berlin, 08. Sept., 2021 – If money is now completely programmable, how should a digital Euro be established? This is the question addressed by Establishing a Digital Euro – How to Ensure Financial Sovereignty in the Digital Realm, a new joint study published by the Internet Economy Foundation, Lakestar, Chainlink and iconomy.
Read: JP Morgan warns CBDC could mean banks lose 20-30% of funding
In the wake of the European Central Bank’s announcement in July 2021 that it will begin the process of developing a digital Euro, this new study explains the key design decisions that lie ahead and how each of them can potentially affect the longstanding structures of the monetary and financial systems. It also recommends important guidelines for the ECB to ensure that a digital Euro addresses Europe’s current weakness in global financial services and strengthens Europe’s booming ecosystem of innovation in FinTech, Decentralized Finance (DeFi) and emerging sectors.
The policy recommendations are:
● Create the Digital Euro with a focus on European Financial Sovereignty.
● Use the Digital Euro to reinforce the position of the Euro as an international reserve currency.
● Design the Digital Euro with a wider vision for a more secure future financial system.
● Form should follow function and keep innovation at heart.
● Tailor the Digital Euro to fit the needs and realities of the European startup, scaleup and DeFi ecosystems.
See:
BIS Research: CBDCs beyond borders: results from a survey of central banks
Podcast: Requirements for a fully functional CBDC
The study examines the existing structures of central banks and how the current system relates to financial service providers as well as consumers. It then depicts a pyramid of the four main design decisions that the ECB will have to make and lays out the key pros and cons of each decision. For instance, would a Digital Euro be an anonymous “token”, like a 1 Euro coin, or would it always be tied to an “account”, like the Euro that is spent with a bank Girocard? Each design decision can potentially send a digital Euro in a different direction and have a large impact on its potential usage in the innovative digital economy.
Continue to the full article --> here
Download the 52 page PDF report 'Establishing a Digital Euro' --> here
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, 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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On the Brink Podcast: George Selgin of the Cato Institute on Stablecoins, Bitcoin and Free Banking
On the Brink Podcast | Aug 2, 2021
George Selgin, director of the Center of Monetary Alternatives at the Cato Institute joins the show to discuss Bitcoin, Free Banking, and stablecoins. In this episode:
- Why George refers to Bitcoin as a synthetic commodity money
- Why George was excited by the possibility for synthetic commodity money
- What conditions would have to hold for Bitcoin to be considered money
- Why money is a spectrum rather than binary
- Are stablecoins prone to bank runs?
- Is Tether’s melange of underlying collateral sufficient?
- How should stablecoins be regulated?
- Why are regulators looking into stablecoins today?
See:
FCA Chair Charles Randall Discusses Crypto, Stablecoins and Digital Asset Regulation
More regulation coming: SEC Chairman signals stablecoins and other tokens could fall under its rules on security-based swaps
Minister Freeland releases final report with 34 recommendations on Open Banking from the Advisory committee
- Comparing stablecoins to Money Market Mutual Funds
- Why money market funds broke the buck in 08
- Are stablecoins as systemic as money market funds?
- George’s objections to Gorton and Zhang’s paper on free banking and stablecoins
- George’s definition of free banking
- Was the 1830s-60s period in the U.S. a period of genuine free banking?
- The actual causes of bank failures in the pre-Civil War period
- Why ‘unit banking’ was so fragile
- What lessons can be taken from Canada’s experience with free banking in that era
- Why the history of Free Banking is a red herring in the stablecoin debate
- George’s recommendations for a primer on free banking
- George’s reflections on Hal Finney’s reference to his work
- Why bank failures are often the consequence of regulation
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, 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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