Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Category Archives: Venture Funding and Building
BTQ Signs Kaia Deal for Post Quantum Stablecoin Security
September 30, 2026 | NCFA Market Activity | Digital Assets Blockchain And Tokenization, Cyber Security And Quantum, Payments Infrastructure And Money Movement
Three Year Kaia Agreement, Transaction Fees And Unifi Distribution
On September 30, 2026, Vancouver based BTQ Technologies signed a three year commercial agreement with Kaia DLT Foundation to deploy its Quantum Secure Stablecoin Network (QSSN) across Kaia's blockchain infrastructure. BTQ will receive a share of fees from transactions protected by the system and expects six figure U.S. dollar revenue in the first year, although actual revenue will depend on transaction volume.
In May, NCFA said BTQ still needed paid QSSN deployment and recurring revenue to prove the model commercially. The company had already processed blockchain transactions and worked with Finger and iM Bank on post quantum stablecoin infrastructure, but it hadn't disclosed signed recurring deployment terms. While the company hasn't disclosed a production launch date, the Kaia deal now provides that missing piece.
Post Quantum Protection At Kaia's Infrastructure Layer
BTQ's technology adds post quantum protection to blockchain accounts and transaction infrastructure without requiring every wallet, stablecoin or application to be rebuilt. Kaia, like other blockchain networks, relies on public key cryptography to authorize transactions. A sufficiently powerful future quantum computer could weaken some of that cryptography, although today's quantum computers aren't known to have that capability. Post quantum migration is already underway because replacing cryptography across financial infrastructure can take years.
BTQ combines existing transaction security with post quantum signatures rather than replacing the blockchain. Its system uses cryptography based on NIST post quantum standards while remaining compatible with existing blockchain infrastructure.
Kaia says the protection will operate at both the account and infrastructure level. Stablecoins are a practical starting point because they combine transferable value, digital wallets, long lived transaction records and growing use in payments and settlement. Kaia and Unifi already support stablecoins including USDT, Japan’s JPYC and Indonesia’s IDRP. BTQ says QSSN can protect those assets at the account level without requiring each issuer to build a separate integration.
The bigger commercial point is how BTQ gets paid. Rather than relying only on integration or licensing fees, the three year agreement gives BTQ a share of fees from protected transactions. If usage grows, security revenue grows with it. That turns QSSN from a technical capability into infrastructure with recurring transactional revenue.
Canada is already preparing for this migration problem. The Canadian Centre for Cyber Security requires federal organizations to start planning now, complete migration of high priority systems by the end of 2031 and move remaining systems by the end of 2035. Financial infrastructure faces the same issue across payments, identity, custody and digital assets, where systems may remain in service for many years.
Unifi Gives BTQ A Consumer Distribution Route
LINE NEXT launched Unifi as a global stablecoin wallet in March 2026, with deposits, transfers, payments and rewards available through LINE Messenger. That gives BTQ a path from blockchain infrastructure into consumer stablecoin use rather than another stand alone technology pilot.
For those who don't know, LINE is one of Asia’s largest messaging platforms, with major user bases in Japan, Taiwan and Thailand. LINE NEXT launched Unifi on Kaia in March 2026, giving BTQ a route from blockchain infrastructure into consumer stablecoin use through LINE Messenger.
See: Quantum Bridge Raises USD $8M For Quantum Security
BTQ and Kaia point to potential reach of more than 250 million people across the LINE and Kakao ecosystems. That is the size of the connected consumer networks, not 250 million Unifi or BTQ users. Unifi is expected to be among the first consumer applications to benefit as the Kaia deployment rolls out.
BTQ had already shown the technology working in earlier Korean pilots and reported more than 100,000 mainnet transactions in the second quarter. What was missing was recurring customer revenue. In August, BTQ was still discussing a possible production deployment with Kaia. Six weeks later, the parties signed a three year commercial agreement tied to transaction activity.
Talking Point
The question now is whether post quantum security can generate recurring infrastructure revenue before quantum risk becomes urgent. Transaction volume and recognized revenue will show whether that model works beyond pilots.
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 Webinar Oct 15]: Capital Raising Opportunities and Regulatory Innovation in Ontario
September 29, 2026 | NCFA Event Spotlight | Capital Formation And Venture Markets, Regulation And Policy, Competition And Market Structure
October 15 Session, Financing Limits And Issuer Rule Reviews
On October 15, 2026, the Ontario Securities Commission will host Capital Raising Opportunities and Regulatory Innovation in Ontario, a 90 minute webinar on how businesses can raise capital across Ontario's private and public markets. The session comes while the OSC is looking at where companies encounter financing gaps or regulatory obstacles as they move from startup through maturity.
The webinar runs from 10:00 to 11:30 a.m. Eastern with the OSC staff covering the Listed Issuer Financing Exemption (LIFE), the Well Known Seasoned Issuer (WKSI) regime, prospectus exemptions, streamlined reporting requirements and cross border capital raising arrangements with regulators in France and Hong Kong. A final panel focuses on how evidence from issuers, founders, dealers, investors and advisors informs OSC capital formation initiatives.
Event Overview
Event: Capital Raising Opportunities and Regulatory Innovation in Ontario
Host: the Ontario Securities Commission
Date: October 15, 2026
Time: 10:00–11:30 a.m. ET
Format: Webinar
Registration: Register for the OSC webinar
Agenda
- 10:00–10:15: Ontario capital markets, trends and the OSC's role, with Chief Economist and VP Paul Redman
- 10:15–10:45: LIFE, WKSI, prospectus exemptions, streamlined reporting and cross border capital raising, led by Corporate Finance VP Marie-France Bourret and moderated by McMillan partner Leila Rafi
- 10:45–11:15: Accessing growth capital and how market evidence informs OSC initiatives, with Economic Growth and Innovation VP Benjamin Matthews and Trading and Markets Senior Legal Counsel Gloria Tsang, moderated by Blakes partner Christopher Jones
- 11:15–11:30: Audience Q&A
LIFE, WKSI And Growth Capital On The Agenda
The agenda covers several points where financing can become easier or more difficult as a company grows. LIFE gives eligible listed issuers a lighter route to public capital. WKSI can simplify access for larger, established issuers. Prospectus exemptions provide other routes, while streamlined reporting can affect how much time and money companies spend meeting securities requirements.
LIFE provides a useful example of why regulatory design matters. In May 2025, regulators expanded Canada's Listed Issuer Financing Exemption, raising the financing limit from C$10 million to C$25 million, or as much as C$50 million for larger issuers, subject to conditions. Hundreds of issuers subsequently raised about C$3.7 billion during the first year under the higher limits, roughly eight times the previous pace.
The CSA is now proposing to make those higher limits permanent, with comments due October 21. Higher limits don't prove that regulation caused every additional financing, but issuers clearly used the added capacity. That gives the OSC webinar a concrete example to work from when discussing which rules facilitate capital raising and which may constrain it.
The international agreements with France and Hong Kong add another angle. For companies capable of raising beyond Canada, the issue isn't only how much capital is available domestically. It is also how efficiently an Ontario issuer can reach investors and markets elsewhere without duplicating unnecessary regulatory work.
Where Does Financing Stop Working For Growing Companies?
The OSC's Office of Economic Growth and Innovation is looking across the financing continuum rather than at one exemption or company stage. An early stage company may raise its first outside capital and still struggle when it needs a much larger round. A listed company may have more financing routes but face costs, disclosure requirements or eligibility rules that make some of them impractical.
Canada's recent SME financing gaps evidence shows why formal access and usable access aren't always the same thing. A funding route can exist and still fail to meet the size, cost or timing a growing company needs.
Canada's recent SME financing gaps evidence shows why formal access and usable access aren't always the same thing. A funding route can exist and still fail to meet the size, cost or timing a growing company needs.
Equity crowdfunding offers a specific example. Canada's NI 45-110 startup crowdfunding exemption remains capped at C$1.5 million over 12 months, while NCFA has advocated a C$5 million or higher issuer cap for years. Recent Canadian offerings have also pushed close to the existing C$1.5 million ceiling.
Other markets allow substantially larger raises.
- The EU crowdfunding regime permits up to €5 million over 12 months, while the EU's wider prospectus exemption now reaches €12 million, although member states can apply a €5 million threshold instead. EU crowdfunding and prospectus thresholds provide the regulatory detail.
- In the U.S., Regulation Crowdfunding permits up to US$5 million over 12 months.
- The SEC is also considering a petition to change Regulation Crowdfunding limits, while its separate 2026 Regulation Crypto Assets proposal would create tailored exemptions of up to US$5 million over four years and US$75 million in any 12 month period for certain crypto investment contracts.
The OSC hasn't included equity crowdfunding as part of the webinar, but the Canadian investment crowdfunding issuer cap illustrates the policy question well. When does a financing limit become too low for a growing company and push it toward a more expensive way to raise capital?
The 10:45 panel should be especially relevant for founders, issuers, dealers and funding platforms. The OSC says it will discuss how stakeholder feedback, market intelligence and data influence targeted initiatives. Useful questions include where the regulator sees the largest gaps between startup, private growth and public markets, which requirements materially affect access to capital, and what evidence it needs before changing a rule.
Capital Raising Rules Are Already Under Review
The October 15 session lands in the middle of two live regulatory discussions. The proposed LIFE amendments close for comment on October 21. A separate CSA review, open until November 13, considers public company regulation including issuer classification, financial reporting requirements, private placement hold periods and material change reporting.
Neither process means the OSC has decided that particular rules should change. They do show that regulators are comparing existing requirements with how companies actually raise capital, while the OSC is gathering evidence about financing friction at different stages of growth.
More Reading:
- Almost $4 Billion Shows What Lower Securities Friction Can Do — what happened after higher LIFE limits took effect
- UK Crowdfunding Caps Lift As EU Pushes €12M — larger overseas fundraising limits and the case for revisiting Canada's C$1.5 million crowdfunding ceiling
- Can Canada Turn Access Into Productive Participation? — whether wider financial market access is translating into usable capital and economic growth
- Canada's C$14T Non Bank Financial System Opens Up — how Canada's large pool of non bank financial assets connects with wider market access and competition
Talking Point
Ontario already gives companies several ways to raise capital. The question is where those options stop working as a company grows. Sometimes the problem is investor demand or business risk. Other times, financing limits, costs or regulatory requirements may be getting in the way. The October 15 discussion should help show where the OSC sees those problems and what evidence might support a change.
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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Shopify Opens WebMCP Checkout to AI Agents
September 29, 2026 | NCFA Market Activity | Artificial Intelligence And Data, Payments Infrastructure And Money Movement, Venture Funding And Building
Buyer controlled checkout access for browser AI agents
On September 28, 2026, Shopify expanded WebMCP checkout support, allowing compatible AI browser agents to read and update eligible checkouts and submit orders after buyer approval. The Ottawa based commerce company now lets software agents move beyond product discovery and cart management into checkout itself, while keeping purchase approval and payment authority under separate controls.
Shopify already exposes product search, store browsing and cart functions to agents. Checkout is an important addition because the software can now move from helping someone shop to executing a real transaction. Can the agent spend on its own? No. Shopify still separates what the agent can do inside checkout from what the customer can authorize and what the payment provider will accept.
Shopify says millions of businesses in more than 175 countries use its commerce infrastructure, which processed US$378 billion in gross merchandise volume in 2025. A Canadian company operating at that scale is now helping define how software agents enter commerce without turning access to checkout into open authority over a customer's money.
Shopify Opens Checkout Functions To AI Agents
WebMCP lets a website expose specific functions directly to a compatible browser agent. Instead of inspecting a page and trying to work out which field or button to use, the agent can see the actions Shopify makes available and the information each action requires. It improves transaction reliability because checkout needs predictable actions and an accurate view of the order, while product discovery can tolerate more browser trial and error.
Shopify first exposed WebMCP tools for storefronts on August 5, 2026, letting agents search products, browse stores, manage carts and take shoppers to checkout. The September release extends that access so the agent can read the current checkout, update supported information and submit the order after the customer approves it. Contact details, fulfillment choices, discounts and some payment information can be changed, while the agent and customer continue working from the same checkout state.
Access isn't universal though. Shopify excludes several flows, including B2B checkout, embedded checkout, draft orders, order edits and payment collection. Standard three page checkout is also excluded unless the customer uses Shop Pay. Merchants do not need to install a separate WebMCP app for eligible sessions, giving Shopify a way to expose agent access through infrastructure merchants already use rather than requiring a new integration for every AI shopping service.
Browser WebMCP also differs from Shopify's server based commerce tools. WebMCP operates inside the shopper's open browser tab, while Checkout MCP lets an agent service interact with checkout from its own server. Both use Shopify's Universal Commerce Protocol checkout model. Shopify is turning parts of checkout into functions software can call directly while retaining control over which functions it exposes.
Buyer Approval And Payment Authority Remain Separate
If an agent can operate checkout, who controls the purchase? Shopify requires the customer to review the current order and total before the agent can submit it. If the amount changes, the agent has to ask again. Permission therefore applies to the transaction the customer sees, not to an open instruction that allows the agent to keep spending.
Shopify also keeps agent identity separate from purchase authority. Web Bot Auth can identify a registered agent, but recognition doesn't provide the software permission to place an order. Payment access is even more narrow. Checkout WebMCP doesn't accept new card details. An eligible saved Shop Pay card can be selected, while other payment methods or authentication steps may return control directly to the customer. Shop Pay login and 3D Secure are examples.
The transaction is controlled by several parties. Shopify decides what the agent can do inside checkout, the customer decides whether the current purchase should proceed, and the payment provider decides whether the credential can be used and whether more authentication is required. That separation between agent identity and financial authorization becomes more important as AI agents evolve from recommending products to initiating real transactions.
In September, Mastercard, Flybits and Rogers Bank demonstrated an AI shopping assistant completing a card purchase after the customer supplied buying instructions and a spending limit. Mastercard Agent Pay operates around the credential, agent identity and instructions attached to the payment. Shopify controls what the agent can do inside merchant checkout.
Are Shopify and Mastercard trying to own the same part of agent commerce? Not really. One controls access to the merchant transaction. The other operates where payment credentials and authorization take over. As AI performs more of the purchase, those separate control points become easier to see.
Shopify Can Lose Discovery Without Losing The Transaction
If shopping assistants become easy to reproduce, more valuable infrastructure may develop around checkout access, agent identity, payment credentials, spending limits, merchant restrictions, fraud controls and records showing who approved what. A founder doesn't need to build another shopping assistant to participate in agent commerce. There are products to build between the assistant and the transaction.
See: Circle Builds USDC Payment Infrastructure for AI Agents
Discovery, checkout, credential use and authentication don't have to belong to one company. Different providers can control each function, which makes the handoffs commercially important. Companies that become difficult to remove from those handoffs may capture value even if consumers rarely recognize their names.
Product discovery may happen inside ChatGPT, Gemini, Copilot or another agent rather than on a merchant storefront. Does that weaken Shopify's position? It can reduce Shopify's control over the first interaction, but the transaction can still reach Shopify checkout, merchant systems and payment infrastructure. Shopify can remain part of the economic relationship even when another platform owns the conversation that starts the purchase.
Talking Point
Structured agent access also creates another route into checkout without requiring every AI system to interpret the storefront visually. The commercial evidence is still early, but the technical capability now exists. The market still has to prove whether consumers want agents doing enough purchasing to create a significantly different commerce channel and whether merchants see enough value to change how they manage sales, fraud and customer relationships.
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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Anthropic IPO Reveals the $518B Cost of Frontier AI
September 29, 2026 | NCFA Insight | Artificial Intelligence And Data, Capital Markets And Market Infrastructure, Venture Funding And Building
Revenue grew 11x as compute commitments reached at least US$518B
On September 28, 2026, Reuters revealed new details from Anthropic's confidential IPO filing, showing 2025 revenue rose to about US$4.6 billion while compute and infrastructure costs reached US$7.33 billion. Anthropic has committed at least US$518 billion to cloud, compute and other AI infrastructure over roughly a decade.
Anthropic confidentially submitted its draft Form S-1 to the U.S. Securities and Exchange Commission on June 1. The filing isn't public yet, so the financial details come from journalists who reviewed the prospectus rather than an SEC document investors can inspect themselves. Anthropic also hasn't set the number of shares, IPO price or offering size yet.
The filing gives public market investors something private AI companies rarely provide. Anthropic's revenue is growing at extraordinary speed, but so are the costs and commitments needed to keep Claude running and improving. The question isn't simply whether demand for AI keeps rising. It is whether that demand can grow fast enough to absorb infrastructure contracted years before the customers arrive.
Anthropic Revenue Rose 11x As Compute Costs Tripled
Anthropic generated about US$400 million of revenue in 2024 and nearly US$4.6 billion in 2025, an increase of roughly 11.5 times in one year. Compute and infrastructure spending moved just as aggressively, rising to US$7.33 billion in 2025, about three times the prior year level. That one expense represented roughly 58% of Anthropic's US$12.65 billion of operating expenses and about 1.6 times annual revenue.
| 2025 metric | Amount | What it tells investors |
|---|---|---|
| Revenue | ~US$4.6B | About 11.5 times 2024 revenue |
| Compute and infrastructure | US$7.33B | About 159% of revenue and 58% of operating expenses |
| Operating loss | US$8.06B | Operating costs still exceeded the rapidly growing revenue base |
| Net loss | ~US$42B | Includes a large financing related accounting charge |
| Cash and short term investments | US$20.28B | Year end liquidity before later financing |
| Future infrastructure commitments | At least US$518B | Multi year cloud, compute and infrastructure contracts |
The US$42 billion net loss needs a bit of context. Roughly US$34 billion came from an accounting charge tied to financing instruments that can convert into Anthropic shares. That doesn't mean Anthropic spent US$42 billion in cash operating Claude. The operating number is US$8.06 billion loss generated after revenue and operating costs are compared.
Does that mean the economics are getting worse as Anthropic grows? The current 2026 numbers make that difficult to conclude. Preliminary second quarter revenue exceeded US$11.5 billion, up from US$4.73 billion in the first quarter, and Anthropic reported positive adjusted operating income for the quarter. Those aren't audited full year results, but they show how quickly the picture is changing.
Rapid revenue growth doesn't remove the infrastructure problem, and it makes securing enough compute more urgent.
Anthropic Has Committed At Least US$518B To Compute
Anthropic expects to spend at least US$518 billion over roughly a decade across six infrastructure partners. Reuters reports that about 80% of those commitments are noncancelable or require payment regardless of how much capacity Anthropic actually uses. The known agreements include at least US$111.1 billion with Google, US$110 billion with Amazon, US$31.4 billion with Microsoft and about US$161.2 billion of Broadcom related equipment lease obligations.
Is US$518 billion debt?
No. The figure combines different cloud, compute, equipment and infrastructure contracts spread across years. Some arrangements can also be cancelled. Anthropic's agreements with xAI, for example, could involve up to US$84.5 billion of Nvidia based capacity through 2029 but are largely cancelable with 90 days notice.
The less flexible contracts create the bigger financial issue. Anthropic is reserving enormous amounts of future capacity before it knows exactly how quickly model efficiency, compute prices, customer demand and competition will change. Its filing reportedly warns that access to compute could constrain growth before customer demand does. If Anthropic is right, securing capacity early protects revenue growth. If demand, pricing or technology changes faster than expected, fixed infrastructure commitments become much harder to absorb.
BGC's compute infrastructure markets are creating price discovery and risk management around compute and memory capacity. When capacity is scarce, expensive and contracted years ahead, compute becomes something Anthropic has to finance and manage like major infrastructure, not just pay for as a cloud service.
The supplier relationships are unusual too. Amazon and Google are major Anthropic investors as well as infrastructure providers, and their platforms help distribute Claude. Microsoft also supplies infrastructure while competing across AI. These relationships give Anthropic capital, compute and distribution, but they also make a small group of large technology companies important to several parts of the business at once.
Demand is also concentrated. Nearly one quarter of 2025 revenue came from two customers, while many larger customers are not locked into long term contracts. Anthropic therefore has substantial fixed commitments on the infrastructure side while parts of its customer base remain comparatively flexible. That mismatch deserves your attention.
A US$2T Anthropic IPO Would Price Growth Years Ahead
Reports that Anthropic may seek a valuation above US$2 trillion doesn't make the company worth US$2 trillion today. The firms last reported private valuation was about US$965 billion in May, so US$2 trillion remains a target until shares are actually priced.
Anthropic could also reach public markets before its closest frontier AI rival. OpenAI CEO Sam Altman said in September that OpenAI's public market timeline now extends beyond 2026, pushing any listing to at least 2027. Anthropic could therefore become the first major frontier model company to give public investors a direct look at the economics of building and operating AI at this scale.
See: Goldman Sachs Buys Québec AI Compute Platform QScale
Preliminary second quarter 2026 revenue exceeded US$11.5 billion, while Anthropic's annualized revenue run rate reportedly passed US$65 billion by the end of July. Investors will have to decide how much of that acceleration can persist and how much compute, capital and fixed infrastructure Anthropic must secure to support it.
Reuters reports that roughly 80 of the prospectus's 261 main pages cover risks, including the possibility that more capable AI could resist shutdown, conceal information, facilitate cyber or biological misuse and cause catastrophic harm.
Talking Point
Revenue can multiply in a year while infrastructure contracts extend for a decade. The market now has to decide whether that growth can remain fast and profitable enough to justify committing hundreds of billions of dollars to compute before future demand is known.
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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What Happens When Ethereum Stops Computing Everything?
September 29, 2026 | NCFA Insight | Digital Assets Blockchain And Tokenization, Artificial Intelligence And Data, Cybersecurity And Fraud, Digital Identity And Trust, Venture Funding And Building
Proofs could change what blockchains actually need to do
On September 27, 2026, Ethereum cofounder Vitalik Buterin proposed a much different future for Ethereum in his latest essay titled The Cryptographic World Computer. Instead of making every node download the same data and repeat the same calculations, Ethereum would rely far more on cryptographic proofs, data sampling and specialized computers working outside the blockchain. The network would verify more work without having to perform all of it itself.
This isn't just a distant research idea. ZK rollups already execute transactions away from Ethereum and send validity proofs back for verification, while Ethereum's PeerDAS system lets nodes check that rollup data are available without every node downloading all of it. The Ethereum Foundation now says its long term plan for the base network includes succinct execution proofs so validators can eventually verify a proof instead of executing every block again.
A key question for founders and investors is what becomes possible when a blockchain no longer has to do all of the work it is trusted to verify?
Why Every Blockchain Node May Not Need To Do Everything
Blockchains deliberately duplicate work. Independent computers receive transactions, apply the same rules and calculate the resulting state for themselves. That repetition helps participants agree without trusting one central operator, but it also costs money and limits capacity. Cryptographic proofs offer another approach. A computer or group of computers can perform a calculation elsewhere, produce mathematical evidence about the result and let the blockchain verify that evidence instead of repeating the entire calculation.
Some of this already works today where different systems are already handling different parts of the job. Computation, data availability, execution and settlement do not all have to live in one place:
- ZKsync Era performs computation offchain, bundles transactions and sends validity proofs back to Ethereum. Ethereum does not execute every ZKsync transaction itself
- PeerDAS applies a similar idea to data. Since Ethereum's Fusaka upgrade went live on December 3, 2025, nodes can sample pieces of rollup data rather than making every node download every blob (collectively, those samples give the network confidence that the complete data are available)
- Celestia takes the separation further by treating data availability as a service that's separate from execution and settlement. Its light nodes can sample small parts of a block and gain confidence that the full data were published without downloading the whole block
Ethereum's September 2026 protocol priorities point toward an even more radical version of the same idea. The Ethereum Foundation says its planned zkEVM work is intended to move execution proofs from optional to mandatory, with validators eventually verifying a succinct proof instead of executing every block again. Buterin's proposal is not that computation disappears. It is that every validator may no longer need to repeat it.
This model may influence how other blockchains are built too. A payment application could use one network for final settlement, another service for proofs and ordinary cloud infrastructure for most business logic. A privacy system could keep sensitive information outside a public ledger while proving that a required condition was met. An AI agent could perform hundreds of calculations elsewhere and submit only the authorized transaction and the evidence needed to accept it.
It's less about putting everything onchain and more about deciding what everyone actually needs to agree on. That might be ownership, transaction order, a payment, a collateral threshold, an identity condition or proof that software remained inside an approved mandate. Most application may not need global consensus at all.
What Could Founders Build If Verification Gets Cheaper?
A financial agent may compare products, calculate risk, call external services and evaluate several transactions before acting. Putting that entire process on a blockchain would be expensive and could expose information nobody needs. A more practical design could let the agent work elsewhere and prove selected facts when money or ownership changes. Did it stay below a spending limit? Was the beneficiary approved? Did the transaction satisfy a stated policy? Was the final instruction authorized (see AI agents and financial authorization)?
A correct calculation and an authorized action are different things, and financial systems will need both. Proofs could confirm parts of what an agent did while deterministic controls decide what it was allowed to do in the first place.
Another practical use is proving a financial condition without revealing everything behind it.
- A lender might need to establish that income exceeds a threshold without publishing a borrower's complete financial history
- An investment platform might need to confirm eligibility without exposing every identity record
- A company might want to demonstrate that reserves or collateral meet defined rules without disclosing every underlying position
These applications would still depend on trustworthy source data, clearly written rules and legal acceptance. A cryptographic proof can't repair bad information, but it can reduce how much information has to be exposed when the underlying conditions are sound.
Proof generation could evolve into an infrastructure market of its own. If applications rely on proofs, someone has to create, combine and verify them efficiently. That creates room for specialized proving hardware, proof aggregation, cryptographic coprocessors, decentralized compute and developer tools that help determine which work belongs onchain and which work can happen somewhere else.
Regulated finance may eventually find uses as well. Banks, custodians, asset managers and payment companies regularly need to confirm capital, collateral, identity, transaction limits or asset eligibility. Some checks could use cryptographic evidence instead of moving the full underlying dataset between parties. That wouldn't replace regulatory reporting, record keeping or supervisory access, but it could reduce unnecessary data sharing when a counterparty only needs to know whether a specific condition was met.
The economics could also look different from today's blockchain market. If applications buy computation, proofs, storage and settlement separately, value may accrue to infrastructure companies where the economics could accrue differently from today's blockchain market of chains or exchanges. For investors, transaction counts on one chain may tell less of the story than which technical jobs become scarce, costly or strategically important as networks divide the work.
Can This Architecture Survive A Quantum Computer?
What happens when quantum computers become powerful enough to break some of the cryptography blockchains use today? The answer isn't that cryptographic verification stops working. Practically speaking, the cryptography at risk will need to be replaced, and robust systems designed to last will need a clear way to do that.
Ethereum's quantum resistance work identifies four important areas that require changes. 1. Account signatures using ECDSA, 2. validator BLS signatures, 3. KZG commitments used for data availability and 4. some zero knowledge proof systems. The Ethereum Foundation has set an internal goal of making Ethereum's execution, consensus and data layers resistant to quantum attacks by December 2029. It describes that date as an internal engineering target, not a forecast for when a cryptographically capable quantum computer will arrive.
Some of the tools Buterin expects Ethereum to rely on could help with that work. STARKs rely heavily on hash functions rather than the elliptic curve assumptions threatened by sufficiently capable quantum computers. Ethereum researchers are also developing signature systems based on hash functions and ways to aggregate large signatures and proofs designed to resist quantum attacks before they reach the chain.
Every blockchain, custody system, wallet or tokenized asset platform that depends on vulnerable public key cryptography eventually has to decide how its keys, signatures and commitments can be replaced.
The U.S. National Institute of Standards and Technology has already finalized its first standards for cryptography designed to resist quantum attacks and says organizations should begin migrating. In this post we look at Why Fintech Can't Wait For Quantum Computing. NIST's current post quantum guidance calls for organizations to identify vulnerable cryptography and prepare replacement plans. Its transition work aims to remove algorithms vulnerable to quantum attacks from NIST standards by 2035, with higher risk systems expected to move sooner.
Blockchain adds another concern because wallets, tokenized assets, identity credentials and transaction records may remain economically important for decades. A founder building financial infrastructure designed to last should therefore ask two questions combined. What work can we verify instead of repeating, and can we replace the security behind that proof when we need to?
Those questions point toward opportunities in wallets designed to resist quantum attacks, key migration, cryptographic inventory, proof aggregation, formal verification, custody migration and software that can change signature methods without rebuilding an entire application.
Talking Point
If blockchains can trust a proof instead of repeating the work, which financial activities still need to happen onchain, and which only need to be verified there?
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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CIRO Crypto Fees Put Market Structure Into the Price
September 28, 2026 | NCFA Insight | Digital Assets Blockchain And Tokenization, Competition And Market Structure, Risk Compliance And Regtech, Wealth Investing And Trading
Crypto Surveillance Costs And Market Structure
On September 28, 2026, the Canadian Investment Regulatory Organization (CIRO) is accepting final comments on a crypto fee proposal that would add a separate annual surveillance charge for regulated crypto trading platforms. Minimums would start at C$50,000 for Level 1 firms and C$100,000 for Levels 2 and 3. The model would start July 1, 2027, with full cost recovery beginning April 1, 2028.
Crypto firms already pay dealer and other regulatory charges in Canada. The proposed fee would recover the added cost of monitoring crypto trading, including activity involving outside venues. How a platform reaches the market changes the surveillance work required and, under this proposal, would also change the regulatory bill.
Three Trading Structures, Different Surveillance Bills
The proposal divides crypto trading platforms into three levels. They don't represent company size. They describe how trades reach the market and what the regulator has to monitor.
| Level | Operating structure | What CIRO monitors | Annual surveillance minimum |
|---|---|---|---|
| Level 1 | Canadian dealer connects clients to an unaffiliated external venue for execution | Trade executions | C$50,000 |
| Level 2 | Canadian dealer gives clients access to one or more affiliated marketplaces outside Canada | Canadian executions plus added data review | C$100,000 |
| Level 3 | Dealer operates a Canadian marketplace without routing client orders to another marketplace | Trades, orders and market messages | C$100,000 |
Total surveillance costs would first be divided among the three levels. Each level's share would then be allocated among its members using trading activity. For its illustrations, CIRO used surveillance weights of 1 for Level 1, 3 for Level 2 and 10 for Level 3. Those weights represent its estimate of the work required for each structure.
Once full cost recovery begins in April 2028, CIRO estimates that a small Level 1 member could pay C$50,000 a year, while a large one could pay C$75,000 to C$125,000. Level 2 ranges from C$100,000 for a small member to C$175,000 to C$250,000 for a large one. A large Level 3 marketplace could reach C$200,000 to C$300,000. The current estimated annual crypto surveillance cost pool is about C$1 million, although membership, trading activity and vendor costs can change that amount.
A new Level 1 member with fewer than 100,000 trades during the 12 months before onboarding can qualify for a C$25,000 surveillance fee in its first fiscal year. The normal Level 1 minimum then becomes C$50,000. Levels 2 and 3 don't receive that bridge under the proposal.
See Are Regulators Opening Markets While Raising Costs?
A dealer using outside liquidity, a Canadian arm connected to an affiliated foreign venue and a Canadian marketplace aren't three versions of the same licence. They require different surveillance work, which is why their proposed fees differ.
What Each Canadian Operating Model Actually Pays
The crypto surveillance charge would be only one part of the Canadian cost stack. A crypto dealer also pays an annual dealer fee based on revenue and its number of Approved Persons. Under CIRO's proposed July 2027 fee schedule, the CTP category does not have the C$25,000 minimum dealer fee that applies to ordinary Investment Dealers.
The annual dealer calculation uses the firm's revenue component plus C$300 for each Approved Person. Using the FY2027 revenue rate of 0.000943033, a crypto dealer with C$5 million in regulated revenue and 20 Approved Persons would pay about C$10,715 for the dealer layer. That is separate from the proposed crypto surveillance charge.
A new crypto dealer also pays a C$40,000 entrance fee. C$6,250 of that amount is an application review deposit that can be credited toward the annual dealer fee after approval. A newly approved dealer must also contribute 0.5% of its expected initial capital to CIRO's Restricted Fund.
A Canadian marketplace adds more setup costs. The minimum Regulation Services Agreement fee is C$25,000, while required connectivity and testing starts at C$66,500. Both can rise if more work is required. New functionality can also create additional technology development and testing costs.
| Operating model | One time entry and setup | Annual dealer fee | Annual crypto surveillance | Known Year 1 minimum shown here | Known ongoing annual minimum |
|---|---|---|---|---|---|
| 1. New Level 1 dealer Independent external venue |
C$40,000 entrance fee, plus 0.5% of expected initial capital | Revenue component + C$300 per Approved Person. C$6,250 application review deposit can be credited after approval. | C$25,000 in the first fiscal year if bridge conditions are met | At least C$65,000 plus 0.5% of expected initial capital, before any dealer fee not covered by the credit | Annual dealer fee + at least C$50,000 surveillance after the bridge period |
| 2. Established Level 1 dealer Independent external venue |
None if already approved | Revenue component + C$300 per Approved Person | C$50,000 minimum, rising with activity | Not applicable as a new entry calculation | Annual dealer fee + at least C$50,000 surveillance |
| 3. New Level 2 dealer Affiliated foreign venue |
C$40,000 entrance fee, plus 0.5% of expected initial capital | Revenue component + C$300 per Approved Person. C$6,250 application review deposit can be credited after approval. | C$100,000 minimum | At least C$140,000 plus 0.5% of expected initial capital, before any dealer fee not covered by the credit | Annual dealer fee + at least C$100,000 surveillance |
| 4. New Level 3 Canadian marketplace | At least C$131,500 C$40,000 entrance fee + C$25,000 RSA minimum + C$66,500 connectivity and testing minimum, plus 0.5% of expected initial capital |
Revenue component + C$300 per Approved Person. C$6,250 application review deposit can be credited after approval. | C$100,000 minimum | At least C$231,500 plus 0.5% of expected initial capital, before any dealer fee not covered by the credit or added technology work | Annual dealer fee + at least C$100,000 surveillance, plus applicable marketplace costs |
The table separates charges paid to get started from fees that continue each year. It doesn't include legal work, audits, required working capital, custody, insurance, staffing or Canadian Investor Protection Fund assessments. Marketplace technology work can also push the Level 3 entry cost above the minimum shown.
An existing CIRO Investment Dealer has another route. Adding a crypto trading platform business line carries a C$10,000 business change fee instead of the C$40,000 entrance fee for a new dealer applicant. The firm's existing annual dealer obligations continue and the crypto surveillance charge would be added to them.
See: Canadian Crypto Trading Platform Compliance Framework
Take the same established firm with C$5 million in regulated revenue and 20 Approved Persons. Its annual dealer fee would be about C$10,715. As a Level 1 platform paying the minimum surveillance charge, the two known CIRO layers would total about C$60,715 a year. At the Level 2 or Level 3 minimum, they would total about C$110,715 before any marketplace costs.
A Level 3 Canadian marketplace starts with the same dealer costs as another CTP, then adds marketplace setup costs and a higher surveillance burden because CIRO directly monitors its orders, trades and market messages.
NCFA’s view is that the surveillance fee cannot be judged by the C$50,000 or C$100,000 minimum alone. The full cost depends on how a platform enters Canada, whether it operates as a dealer or marketplace, where trades are executed and how much activity it generates. A scaled dealer may absorb these charges relatively easily. For a new entrant or domestic marketplace, the same fixed costs take a larger bite before the business has built volume.
That makes the structure of the fee as important as the amount. Canada is asking firms that create more surveillance work to pay more of that cost, which has a clear regulatory logic. At the same time, operating Canadian marketplace infrastructure carries costs that a dealer using outside liquidity may avoid. Whether those differences are large enough to influence where firms build, route trades or invest in Canadian infrastructure is the competition question worth watching.
Other Markets Put Regulatory Cost In Different Places
Crypto firms in other major markets also pay for licensing and supervision. In the markets compared below, those costs are collected through different fee layers and formulas. Canada's proposal adds a separate crypto market surveillance charge on top of its dealer calculation.
| Market | One time entry or application | Annual dealer or licence layer | Annual surveillance or supervision layer | What mainly drives the annual bill |
|---|---|---|---|---|
| Canada | C$40,000 for a new CTP dealer applicant. Existing Investment Dealer adding a CTP business line pays C$10,000. Level 3 also faces marketplace setup costs. | Revenue component + C$300 per Approved Person. No separate C$25,000 dealer minimum is listed for the CTP category. | Separate C$50,000 or C$100,000 crypto surveillance minimum, then activity allocation | Dealer revenue, Approved Persons, trading structure and trading activity |
| United Kingdom Current regime |
£11,260 crypto registration fee | Annual periodic fee starts at £2,251, plus £6.01 for every £1,000 of crypto income above £100,000 | No separately published crypto market surveillance charge under the current money laundering registration regime | Annual crypto income |
| New York | US$5,000 BitLicense application fee | No comparable flat annual BitLicense fee | Annual assessment recovers supervision, examination and regulatory operating costs | Transaction volume, custody and shared regulatory costs |
| Singapore | S$1,500 application fee | S$10,000 annual licence fee | No separately stated crypto surveillance fee comparable to CIRO's proposed charge | Flat licence structure |
| Hong Kong | HK$4,740 per applicable licence or regulated activity | Annual licensing fees apply by regulated activity | No separately stated crypto surveillance fee comparable to CIRO's proposed charge | Licence and regulated activity structure |
Canada is the only market in this comparison that publishes crypto surveillance as a separate recurring fee layer on top of the dealer calculation. That doesn't mean regulators elsewhere supervise crypto markets for free. The costs are collected differently. New York comes closest to the same cost recovery concept because its annual assessment explicitly recovers supervision and regulatory operating costs using transaction volume, custody and shared expenses.
The United Kingdom currently charges from income rather than trading architecture. Under the 2026/27 FCA formula, a crypto business pays £2,251 a year plus £6.01 for every £1,000 of annual crypto income above £100,000. Using the Bank of Canada's September 25 rate, C$5 million equals about £2.67 million. The resulting FCA annual fee is about £17,685, or C$33,100.
Use the same C$5 million revenue example in Canada with 20 Approved Persons and the dealer layer comes to about C$10,715. Add the Level 1 surveillance minimum and the two known annual CIRO charges total about C$60,715. The Canadian number rises with surveillance activity, while the UK formula rises with income.
The two numbers aren't directly comparable because the regulators are charging for different functions. Britain's current annual crypto fee funds money laundering supervision. Canada's proposed charge would sit beside the dealer fee and specifically recover crypto surveillance costs.
The UK is also preparing a fuller crypto regime. Its application gateway opens September 30, 2026, with the new regime taking effect October 25, 2027. Operating a qualifying crypto trading platform carries a £28,150 application fee under the new fee schedule. That is an entry charge, not an annual surveillance fee. The recurring cost structure will be more useful for comparison once the new regime is in force.
See: Are Regulators Opening Markets While Raising Costs?
Singapore uses a much flatter published fee structure. Its digital token service regime lists a S$1,500 application fee and S$10,000 annual licence fee. At the Bank of Canada's September 25 exchange rate, S$10,000 is about C$11,100. The published licence fee does not rise with the firm's trading volume.
Hong Kong's published licence charges are also small compared with Canada's proposed surveillance minimum. The annual virtual asset service licence fee is HK$4,740, about C$855 using the same September 25 exchange date. That isn't the full cost of running a Hong Kong trading platform. Other regulated activity licences, responsible officers, external assessments and compliance costs can also apply.
New York can't be reduced to one reliable comparison number. Its annual virtual currency assessment combines a supervisory component with a regulatory component. Transaction volume and custody help determine the supervisory share, while remaining regulatory operating costs are divided among licensees. Without the regulator's assessment inputs for a specific firm, assigning the hypothetical company a fixed dollar bill would create false precision.
Britain currently scales its annual fee with income. Singapore uses a flat annual licence charge. Hong Kong charges by licence and regulated activity. New York allocates supervisory costs using business activity. Canada would keep its dealer calculation and add a second charge tied directly to crypto surveillance structure and activity.
CIRO says the added charge is meant to recover the surveillance costs created by crypto trading rather than leave the rest of its membership subsidizing them. A domestic marketplace generates more orders, messages and direct surveillance work than a dealer sending executions elsewhere. The business question is whether those differences become large enough to affect where firms invest and whether marketplace infrastructure is built in Canada. At full cost recovery, the crypto surveillance charge alone could range from C$50,000 for a small Level 1 dealer to as much as C$300,000 for a large Level 3 marketplace.
What Happens After Sept 28
Once comments close, CIRO will review the submissions and decide whether the fee structure needs to change before seeking the approvals required to put it into force. CIRO's rulemaking process includes reviewing public comments, obtaining approval from the Canadian Securities Administrators and then publishing the final rule and implementation details. That means the C$50,000 and C$100,000 surveillance minimums, the treatment of new entrants and the three level structure can still change before implementation. CIRO's policy process makes clear that proposals remain subject to comment and approval until a final implementation notice is published.
NCFA sees merit in tying surveillance fees to the work a platform creates, but a fixed cost floor can bite hard for smaller platforms. A C$50,000 or C$100,000 minimum is a much larger burden for a new entrant than for a scaled dealer, and a Canadian marketplace also faces setup costs that a dealer using outside liquidity may avoid. CIRO's proposed surveillance model may reflect genuine differences in regulatory work, but the final structure should still be judged against the full cost of participation. If the combined dealer, surveillance and marketplace charges become materially heavier than comparable regulatory costs elsewhere, Canada could make entry less attractive or give firms fewer reasons to build locally.
Talking Point
Strong surveillance has a clear purpose, but Canada also needs to watch whether the cost structure narrows competition or discourages domestic infrastructure.
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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Hester Peirce’s SEC Legacy And A Decade Of Financial Change
October 2, 2026 | NCFA Story Intelligence | Regulation And Policy, Digital Assets Blockchain And Tokenization, Capital Formation And Venture Markets
Principled Regulation, Working Alternatives And Ideas That Endured
Hester M. Peirce is leaving the U.S. Securities and Exchange Commission after nearly nine years as a commissioner and almost two years leading its Crypto Task Force. In her resignation letter, Peirce set October 2 as her final day at the SEC.
NCFA reported her planned departure in May. That answered where she was going, but it didn't answer the more interesting question.
What did Hester Peirce actually change?
For years, Peirce's public record has stretched across SEC votes, speeches, crypto policy, capital formation, investor access and regulatory process. In 2021, she also spoke directly with Canada's fintech community at FFCON21.
The record is much richer than the "Crypto Mom" nickname.
Peirce argued consistently for rules people could understand and use, investor choice, public consultation, room for lawful experimentation and restraint when old regulatory structures met new technology. She also supported enforcement where laws applied and repeatedly returned to the importance of trustworthy markets.
She didn't prevail on every issue. Nor did every later policy change happen because of her. Courts changed outcomes. Congress acted. SEC leadership changed. Technology matured. Institutional investors entered markets they once avoided.
Peirce kept doing something that gave her ideas a longer life.
She put alternatives on the table.
By 2025, she had the chance to help build policy through the SEC Crypto Task Force. In 2026, SEC Chair Paul Atkins explicitly pointed back to her 2020 Token Safe Harbor as the Commission proposed Regulation Crypto Assets.
It is a story about a regulator who kept asking whether the rules still served investors, markets and innovation, and who spent years putting practical alternatives on the table when she believed they did not.
In 2016, fintech was still fighting for a regulatory home. The Office of the Comptroller of the Currency was developing a responsible innovation framework and debating whether fintech companies should qualify for special purpose national bank charters. The SEC was discussing blockchain, automated advice and online lending as new technologies pressing against established financial rules.1
Crypto was even further outside conventional finance. In 2017, the SEC's DAO Report established that some digital token transactions could fall under U.S. securities law. There were no U.S. spot bitcoin exchange traded products, no SEC Crypto Task Force and no tailored crypto offering regime. When Peirce joined the Commission in January 2018, many of today's basic regulatory questions were still wide open.2
Her first major crypto disagreement arrived within months. In July 2018, Peirce dissented from the SEC's rejection of the Winklevoss Bitcoin Trust. She argued that the exchange had met the relevant statutory standard and worried that denying access to a regulated product could push investors toward less regulated ways of getting bitcoin exposure.3
The majority had legitimate market integrity concerns. Bitcoin trading was fragmented and market surveillance was still developing. Fraud and manipulation mattered. Years later at FFCON21, Peirce herself described the exchange traded product review as highly data intensive, including questions about price formation, futures markets and oversight of spot venues. Her disagreement was narrower. She believed bitcoin products were being held to a different standard.
The Token Safe Harbor gave network builders a clock. Peirce proposed three years for qualifying token projects to develop toward functionality or decentralization while providing disclosures and remaining subject to antifraud rules. The proposal addressed a practical problem. A team might need to sell tokens to build a network, yet those same promises could make the sale look like an investment contract.4
She changed the proposal after people pushed back. Safe Harbor 2.0 added an exit report and other refinements in 2021. Peirce didn't pretend the ambiguity had disappeared. She continued asking for feedback and said the proposal needed enough detail to give market participants useful certainty.5
The SEC's enforcement strategy hardened the disagreement. Peirce accepted that securities laws applied when the facts brought an activity inside them. Her objection was practical. Telling firms to register didn't solve much when the existing registration structure didn't fit the activity. Her call for clearer crypto regulation was already part of the public debate, and in 2022 she described one company at a time enforcement discussions as "not a good way of regulating."
DeFi exposed the same disagreement in a more difficult form. The SEC argued that systems performing exchange functions could still require securities oversight. Peirce worried that expanding exchange rules could force decentralized software into structures designed around identifiable intermediaries. The fight over the SEC's proposed exchange definition made that tension explicit in 2023.
Spot bitcoin products finally cleared the SEC in January 2024. More than 20 spot bitcoin exchange filings had been rejected from 2018 through March 2023. The D.C. Circuit later found that the SEC had not adequately explained its treatment of Grayscale's application. The Commission approved multiple spot bitcoin products after the court sent the matter back.6
Peirce saw the approval as much later than it needed to be. Her reaction appeared in Peirce Laments, SEC 'Squandered A Decade'. Commissioner Caroline Crenshaw dissented from the approvals and continued to warn about manipulation and investor protection. The approval settled access to the product. It didn't settle the argument over crypto market risk.
Then the job changed. On January 21, 2025, Acting SEC Chair Mark Uyeda launched the Crypto Task Force and asked Peirce to lead it. The mandate included clearer regulatory boundaries, realistic registration options, disclosure frameworks, public engagement and coordination across government.7
Public engagement became part of the work. The Task Force held sessions on security status, trading, custody, tokenization and DeFi, then took meetings outside Washington to hear from smaller projects that had not always participated in SEC policymaking. At the April 2025 crypto custody roundtable, Peirce argued that custody rules needed to account for the technology without weakening investor protection. The discussion also brought self custody, broker dealer models and legal ownership into the same policy conversation.
Tokenization shows that her position is not simply deregulatory. In July 2025, Peirce said tokenized securities could help capital formation and collateral use, but tokenization did not erase securities law. Third party tokenization still had to avoid misleading investors or weakening investor protections.
DeFi gets a more structured compliance conversation too. At the June 2025 Crypto Task Force roundtable, SEC leadership considered conditional relief that would give developers room to experiment inside defined boundaries. A DeFi safe harbour brought the same tension Peirce had raised for years into a more formal policy discussion. Builders need a lawful route to experiment, while investors still need disclosure, accountability and usable protections.
Six years after Safe Harbor, the connection became explicit. On August 18, 2026, the SEC proposed Regulation Crypto Assets. The package includes tailored offering exemptions and a conditional safe harbor addressing when a crypto asset is no longer subject to an investment contract. Chair Paul Atkins specifically cited Peirce's 2020 Safe Harbor proposal.8
The proposal was bigger than Peirce. Commission divisions, legal staff, economists, accountants, trading specialists and the Crypto Task Force all contributed. Congress was also working on market structure legislation. Atkins said legislation remained important. Peirce herself credited teams across the Commission for building the proposal.9
September moved policy into live market experimentation. On September 17, the SEC granted temporary and conditional relief allowing limited trading of tokenized U.S. listed stocks through specified onchain venues. Symbol limits, volume caps, transparency, records, technology safeguards and trading stoppage coordination remain part of the structure.10
The Commission deliberately left room to learn. Peirce described the Innovation Exemption as a way for market participants to experiment while the SEC watched how onchain trading worked in practice. Commissioner Mark Uyeda specifically thanked the Crypto Task Force led by Peirce for its work on the exemption.11
Crypto never fully explained Peirce. At FFCON21 she spent a substantial part of the conversation on small business finance. She wanted finders to have a lawful role connecting smaller companies with investors. She questioned wealth as the main gate to accredited investor status and suggested that education or professional experience could demonstrate financial sophistication.
Her concern was who gets access to capital and markets. Peirce told NCFA's community that small businesses outside established wealthy networks could struggle to raise money. She floated a streamlined micro offering of roughly US$250,000 to US$500,000, still subject to antifraud rules, to help companies finance the space between personal networks and institutional capital.
Her working style showed up in the small details. Peirce gave speeches titles about fish behind wheels, empty gas tanks, headstands and haystacks. The metaphors made complicated regulation easier to remember, but the substance underneath them was usually specific. What authority did the SEC have? What problem was the rule trying to solve? Could people comply with it? What unintended cost could it create? Her "Is That A Fish Behind The Wheel?" remarks captured that style in 2022 while arguing that technology could help regulators meet investor protection, capital formation and market integrity goals.
She also left room for disagreement. In June 2026, as her time at the SEC was winding down, Peirce wrote that people could disagree about how capital markets should be regulated while still sharing an interest in markets that serve investors and companies. She also said a Commission seat should not be occupied by the same person for too long and that institutions needed fresh voices.12
Several large questions remain open as she leaves. Regulation Crypto Assets is still proposed. DeFi continues to challenge assumptions about intermediaries and control. Custody remains difficult. The Innovation Exemption is temporary. Congress still has an important role in crypto market structure.
Her final weeks look very different from her first ones. On September 23, speaking during what she calls her penultimate week as commissioner, Peirce discusses tokenized securities, financial privacy and the Innovation Exemption. The argument is no longer whether blockchain belongs anywhere near regulated securities markets. It is how those markets should operate when blockchain is already there.13
People who build companies know the difference between criticism and a usable alternative.
The first tells you what someone dislikes. The second gives you something to work on.
Peirce kept returning with alternatives.
The Token Safe Harbor is the clearest example. It didn't become an SEC rule when she proposed it. She listened to criticism, revised it and left it in the public record. Six years later, the SEC chair cited that work while introducing a formal Commission proposal built for a very different crypto market.
Her record also shows why persistence alone isn't enough. Courts changed outcomes. Elections changed leadership. Congress changed the policy environment. Technology improved. Institutional investors entered markets they once avoided.
What endured were the specific alternatives she left behind.
A minority view can preserve an argument. A detailed proposal can give future policymakers something concrete to reconsider. Public consultation can expose weaknesses before a rule is written. And changing your thinking, as Peirce acknowledged she had on parts of the Howey analysis, can improve the eventual debate.
Founders and industry advocates know this problem well. Complaining about a rule is easy. Designing an alternative that protects investors while giving a legitimate new business model room to work is much harder. Peirce repeatedly did that second piece of work.
Her years at the SEC also coincided with an extraordinary change in financial markets. Crypto moved from the regulatory margins into public markets. Tokenization moved from concept to live infrastructure. Questions about investor access, capital formation and technology neutral rules became part of mainstream securities policy.
At FFCON21 in 2021, Canada's fintech community heard Peirce discuss many of those questions while some of her most important ideas were still proposals. She spoke openly about where the Token Safe Harbor stood, where her own thinking had changed and why new technology should not automatically inherit rules written for a different market.
Five years later, some of those arguments are no longer theoretical.
In 2018, Peirce was arguing that investors should be able to access bitcoin through a regulated exchange traded product. In 2026, she is helping the SEC decide how tokenized U.S. stocks can trade onchain, how crypto assets can be offered under tailored rules and where experimentation can occur inside securities regulation.
That is a remarkable change in the market around her, and Peirce helped make sure some of its hardest regulatory questions were asked before the answers became obvious.
She will join Regent University School of Law as an Associate Professor in November. Regent says her work has focused on regulatory humility, capital markets, crypto regulation and the relationship between innovation and regulation.14
The classroom feels like a fitting next chapter. Peirce spent much of her SEC career asking people to explain their assumptions, defend the authority behind a rule and consider whether a different answer could protect investors while leaving room for markets to change. Students will now get the same invitation to think carefully, argue clearly and reconsider what they thought they knew.
NCFA is grateful that Commissioner Peirce took the time to engage directly with Canada's fintech community through FFCON21. Her public record also gave founders, investors, regulators, lawyers and critics something valuable over nearly nine years at the SEC: clear reasoning, practical alternatives and an explanation of how she reached them.
She leaves with important work unfinished, as every regulator does. She also leaves ideas that now form part of the SEC's policy conversation, work that bears her direct contribution and a record of taking financial innovation seriously while keeping investor protection in view.
We wish Hester Peirce every success at Regent. For Canadian regulators, her record leaves a useful challenge. When markets and technology change, protect investors rigorously, but keep asking whether the rules still fit and be willing to put better alternatives on the table. And we hope the next generation of lawyers gives her arguments the same rigorous challenge she spent years inviting from colleagues, markets and the public.
FAQs
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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