Coinbase, an internationally recognized cryptocurrency exchange, recently obtained registration as a “restricted dealer” by the Canadian Securities Administrators. This registration is the first of its kind for the new Canadian cryptocurrency regulatory guidelines. This blog will provide an overview of these guidelines and how they may apply to a platform in the cryptocurrency space.

The Canadian Securities Administrators

The Canadian Securities Administrators (also referred to as the “CSA”) is an umbrella organization comprising securities regulators across Canada. Its primary mandate is to coordinate and harmonize regulation of the Canadian capital markets. It facilitates collaboration among its members to develop and implement consistent regulatory policies and practices, aiming to protect investors, maintain fair, efficient, and transparent markets, and promote capital formation.

While each member jurisdiction retains its regulatory authority, such as the Ontario Securities Commission in Ontario, the CSA provides a forum for cooperation and the development of national policies, guidelines, and rules to ensure a cohesive and effective regulatory framework for the Canadian securities industry. It is through this mandate that the CSA regulates crypto asset trading platforms.

CSA Regulation of the Cryptocurrency Market

In 2019, the CSA, together with the Investment Industry Regulatory Organization of Canada (“IIROC”), published Joint Consultation Paper 21-402: “Proposed Framework for CryptoAsset Trading Platforms” and Staff Notice 21-329: “Guidance for Crypto-Asset Trading Platforms: Compliance with Regulatory Requirements,” which established the Canadian regulatory framework for crypto trading platforms. In essence, the CSA and IIROC stated that Canadian securities laws apply to trading platforms if they deal with crypto assets that are securities or derivatives or if crypto assets are held on behalf of customers.

The consequence of trading platforms being subject to securities legislation is that they would need to comply with regulatory requirements similar to traditional securities exchanges. This includes registering with securities regulators, adhering to specific operational and reporting standards, and being subject to ongoing regulatory oversight.

The CSA and IIROC continually issue new guidance on how securities legislation may apply and the compliance requirements for trading platforms. For example, in 2021, the CSA and IIROC published Notice 21-329, “Guidance for Crypto-Asset Trading Platforms: Compliance with Regulatory Requirements,” which provided the following guidance for marketplaces and dealers while also mandating an “interim approach.” During this two-year period, trading platforms could register as “restricted dealers” while working through the registration process.

It is prudent that businesses that purchase, sell, or facilitate the sale of crypto assets maintain familiarity with CSA guidelines, which are often posted on the CSA website.

Registration of Cryptocurrency Platforms

As mentioned above, to comply with securities legislation, trading platforms are required to register with any applicable provincial or territorial securities regulators, such as the Ontario Securities Regulator. However, the registration process typically includes the following key steps:

• Application: completing and submitting the required forms, which disclose information about business operations, ownership, compliance policies, etc.;
• Business Operations: providing a business plan that may consist of the platform’s strategy, financial projections, etc.;
• Financial Statements: the platform may be required to demonstrate its financial viability and compliance with capital requirements; and
• Anti-Money- Laundering/ Know-Your-Client Procedures: the platform may be required to provide information about the above compliance procedures.

The platform will likely also be required to sign a pre-registration undertaking to continue operations while the registration application is under review. These undertakings are a set of actions or commitments that a platform agrees to undertake as part of the registration process.

A list of platforms with pre-registered undertakings, as well as registered and restricted dealers in Ontario is provided here. It is prudent that crypto investors understand which platforms have been registered with their respective regulators so that they can safely participate in the crypto market.

Contact the Lawyers at Bader Law for Advice and Guidance Regarding Fintech and Crypto

The trusted business lawyers at Bader Law have decades of experience assisting clients throughout Mississauga, Oakville and the Greater Toronto Area with corporate structuring, financing, and secured lending. Our comprehensive legal guidance also includes helping crypto start-ups with business structure and licensing matters. We provide dynamic business law advice and solutions for companies working within the crypto and fintech sectors. To speak with a member of our talented business law group regarding your corporate matter, contact us online or call us at 289-652-9092.

The Canadian Securities Administrator has announced that enhanced investor protection relating to unregistered cryptocurrency trading platforms operating in Canada will be implemented. This announcement came on February 22, 2023, and is called the “CSA Staff Notice 21-332 Crypto Asset Trading Platforms: Pre-Registration Undertakings – Changes to Enhance Canadian Investor Protection” (referred to as “CSA Staff Notice 21-332”). The CSA Staff Notice 21-332 can be read in full on the Ontario Securities Commission website.

Canadian Securities Administrators collaborate on cryptocurrency regulation

The Canadian Securities Administrators (also referred to as the “CSA”) brings together the provincial and territorial securities regulators, such as the Ontario Securities Commission (also referred to as the “OSC”). This allows the provincial and territorial administrators to collaborate on policies and regulations to ensure consistent application across the country.

A critical area of collaboration across securities administrators in Canada is cryptocurrency. Cryptocurrency or crypto assets are digital coins or tokens which are decentralized from any authority or government and are traded or redeemed without the use of financial institutions.

Bitcoin is just one example of a cryptocurrency. Crypto assets can act as money in certain situations (although not recognized as legal tender in Canada), and can be used for a host of other purposes such as being a security or utility token that allows a holder to access certain networks or services.

Cryptocurrency assets and trading platforms

Crypto assets can be traded through direct peer-to-peer transfers or a cryptocurrency asset trading platform. In Canada, cryptocurrency trading platforms must be registered with the applicable Canadian securities regulator. In Ontario, this regulator is the Ontario Securities Commission. However, unregistered cryptocurrency trading platforms can operate under certain rules while pursuing full registration in Canada.

A list of registered crypto asset trading platforms and banned trading crypto asset trading platforms are available on the Canadian Securities Administrators’ website. These lists are kept up to date and are an important resource for crypto asset investors.

For additional background, please see our blog post titled “Cryptocurrency Trading Platforms in Ontario” which introduces the cryptocurrency landscape in Ontario.

Changes motivated by recent insolvencies of cryptocurrency trading platforms

The Canadian Securities Administrators explained that these new requirements are motivated by recent insolvencies of major cryptocurrency trading platforms, which bring the risk of trading in these assets to the forefront.

As explained by the Canadian Securities Administrators, this risk is higher when using an unregistered trading platform that is not based within Canada.

Enhanced rules will apply to unregistered trading platforms that operate in Canada while pursuing registration

Within 30 days of the publication of this notice, the deadline being March 24, 2023, unregistered cryptocurrency trading platforms operating in Canada will need to provide enhanced pre-registration undertakings to their principal securities regulator.

New pre-registration undertakings are required within 30 days

Pre-registration undertakings are commitments made by unregistered cryptocurrency trading platforms that they will operate in a certain manner and according to certain rules while pursuing registration. These rules are very similar to those of registered cryptocurrency trading platforms.

The CSA Staff Notice 21-332 explains that these pre-registration undertakings aim to enhance protection for investors and level the playing field between registered and unregistered cryptocurrency trading platforms in Canada.

The new pre-registration undertakings are to address the following areas:

• Additional obligations about the custody and segregation of crypto assets held on behalf of Canadians;
• Protecting the pledging or use of crypto assets held on behalf of Canadians;
• Prohibiting the cryptocurrency trading platform from offering any kind of leverage to a client related to the trading of crypto assets on the platform;
• Enhanced commitments from controlling minds and affiliates that impact the cryptocurrency trading platform seeking registration in Canada;
• Constraining the cryptocurrency trading platform from relying on cryptocurrency assets to determine the excess working capital and capital cost of the platform;
• Enhanced disclosure of financial information to the Canada Securities Administrators;
• Requirements related to the employment of a qualified Chief Compliance Officer while the cryptocurrency trading platform is seeking registration in Canada;
• A ban on the purchase or deposit of Value-Reference Crypto Assets (known as “stablecoins”) through crypto contracts unless the prior written consent of the Canadian Securities Administrators has been obtained; and
• A ban on trading crypto contracts that are based on proprietary tokens unless the prior written consent of the Canadian Securities Administrators has been obtained.

These categories of undertakings are described in greater detail within the CSA Staff Notice 21-332.

Changes to be implemented within specific timelines

Unregistered cryptocurrency platforms are expected to implement whatever changes are necessary to comply with these new pre-registration undertakings within the timelines that are specified within the undertaking.

In addition to those listed above, numerous other pre-registration undertakings are required of cryptocurrency trading platforms operating in Canada and seeking registration in Canada. The existing pre-registration undertakings are called “core obligations.” They include, but are not limited to:

• Commitments to act honestly and in good faith;
• Avoid and manage conflicts of interest;
• Refrain from giving investment advice;
• Restrictions on leverage and margins;
• Constraints on advertising;
• Communication of risks of using the platform; and
• Maintaining confidentiality as well as insurance and proper records.

Information on filed pre-registration undertakings can be found on the Canadian Securities Administrators’ website.

Canadian Securities Administrator may take enforcement action

The Canadian Securities Administrators may consider compliance and enforcement action against a cryptocurrency trading platform that does not submit or comply with the required pre-registration undertakings. Possible actions can include, but are not limited to, the following:

• Naming the platform on a Canadian Securities Administrators Investor Alert and/or Investor Warning List,
• Directing the platform to identify Canadian users and to implement off-boarding of existing Canadian users and implement access restrictions to prevent Canadians from accessing their products and services in the future,
• Ordering that the platform and its principals stop trading,
• Ordering denying exemptions under securities law to the platform and its principals, or
• Other penalties as determined appropriate by Canadian authorities.

Contact the Lawyers at Bader Law in Mississauga for Advice and Guidance Regarding Fintech and Crypto

The business lawyers at Bader Law have decades of experience assisting clients throughout Mississauga and the Greater Toronto Area with corporate structuring, financing, and secured lending. Our comprehensive legal guidance also includes helping crypto start-ups with business structure and licensing matters. We provide dynamic business law advice and solutions for companies working within the crypto and fintech sectors. To speak with a member of our talented business law group, contact us online or at 289-652-9092.

Cryptocurrency is a hot topic. The market is growing rapidly, and investors are eager to get in on the action. However, it’s essential to understand the risks before you jump into this risky market. While cryptocurrency has been around since 2009, it’s only recently that people have become aware of its potential as an investment vehicle. Cryptocurrency has grown by leaps and bounds in the past several years, with some currencies increasing in value by thousands of points. But there’s also severe volatility, with some currencies losing up to 90% of their value overnight.

The truth is that no one knows what will happen with cryptocurrency – or the exchanges where these digital assets are stored. But investors must be wary of the risks, or they may lose millions.

FTX crumbles over a 72-hour period

Just this week, what was once one of the largest cryptocurrency exchanges in the world collapsed. FTX crypto exchange was founded in 2019. The collapse of FTX occurred in 72 hours, making it one of the worst collapses in the history of cryptocurrency. 

Initially, clients began to flee after it was announced that FTX was being sold to its rival, the number one cryptocurrency trading firm, Binance. While conducting its due diligence review, the deal fell through. The surge of investors pulling their cryptocurrency from FTX highlighted a fatal flaw: the exchange did not have enough cash on hand to meet the demand for withdrawals.

As a result, the company filed for bankruptcy. In its bankruptcy filing, FTX’s assets were valued between US$10 billion to US$50 billion. A handful of FTX’s 130+ affiliated companies filed for bankruptcy as well. Amid these filings, the company’s CEO stepped down.

Crypto exchange crashes are not new

Earlier this year, another one of the largest cryptocurrency exchanges, Coinbase, reported a US$430 million loss in its first quarter as two million clients jumped ship. This was in lockstep with the drop in price of Bitcoin and Ethereum, marking a time of panic for investors.

Closer to home, Quadriga was a Canadian cryptocurrency exchange that collapsed in 2018. Clients of that exchange lost CA$169 million in the fallout. An investigation by the Ontario Securities Exchange revealed that the founder had engaged in fraud and that the company was running a Ponzi scheme.

What sets the FTX collapse apart

What sets the fallout of FTX apart from other collapsed cryptocurrency exchanges is the concern that FTX was hacked. This past weekend, FTX confirmed that there had been unauthorized access to some of its accounts after its bankruptcy filing. While the amount of money implicated in the hack is yet to be confirmed, it has been estimated that a whopping US$477 million has gone missing.

It is a reminder that while cryptocurrencies are secured by blockchain technology, cryptocurrency exchanges can be more vulnerable. Being the custodian or “bank teller” of these funds, the security of digital assets stored with FTX is not as airtight. It is up to the exchange to protect itself from potential hacks through its own technology.

That said, there is some evidence that FTX was using its clients’ funds to back its own investments. As the exchange moved its headquarters to the Bahamas last year, investigations by the US Department of Justice, the Securities and Exchange Commission, and the Royal Bahamas Police Force are underway.

Who in Canada will be affected?

One of Canada’s biggest pension funds, the Ontario Teachers’ Pension Plan, invested US$95 million in FTX between October 2021 to January 2022. Despite this, the fund has reported that the impact of the collapse would be limited. Other Canadian businesses that will be impacted are the Kevin O’Leary-backed WonderFi Technologies, which invested $617,650 in the exchange, and Bitvo, a Calgary-based company which FTX had been set to acquire. The deal with Bitvo had not yet closed, so the impact overall has been minimal.

Generally, Canadians should be wary when engaging with the cryptocurrency space due to the high risks and developing regulatory landscape that may affect future investments. It is crucial not only to expect volatility in the value of any cryptocurrency but also to be aware of the security risks of storing that cryptocurrency in an exchange.

What options do clients have when a cryptocurrency flatlines?

Like money service businesses, Canadian regulations set requirements for reporting, record keeping, and due diligence by cryptocurrency exchanges. Exchanges must register with the Financial Transactions and Reports Analysis Centre of Canada, widely known as FINTRAC. FINTRAC is an independent government agency that provides law enforcement with financial intelligence, such as information about money laundering or financial terrorism. Reporting to FINTRAC is typically required by the entity and its employees, who are obligated to report suspicious activity under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act.

While cryptocurrencies remain “commodities” under the Bank of Canada Act, cryptocurrency exchanges are classified as securities and subject to various securities requirements. Clients who feel that a cryptocurrency exchange has violated securities laws (which are provincial) should report it to their local securities exchange for investigation.

Contact the Lawyers at Bader Law in Mississauga for Comprehensive Fintech and Crypto Legal Guidance

The business lawyers at Bader Law have decades of experience assisting with corporate structuring, financing, and secured lending throughout Mississauga and the Greater Toronto Area. We provide dynamic business law advice and solutions for companies working within the crypto and fintech sectors. To speak with a member of our talented business law group, contact us online or at 289-652-9092.

A class action has been commenced in the Ontario Superior Court of Justice against a cryptocurrency lender, Voyager Digital Ltd. The proposed class action alleges that Voyager Digital made misrepresentations to investors regarding a loan to a third party and its due diligence measures in relation to it. An unsecured loan Voyager Digital gave to Three Arrows Capital, a hedge fund, put the lender into a precarious financial position concerning the failed Terraform Labs’ cryptocurrencies. Allegedly, the lender misrepresented that it was not affected by the failed cryptocurrencies and that its approach had been low risk. 

In July 2022, Voyager Digital disclosed it was commencing bankruptcy proceedings in the United States. It plans to seek recognition of its U.S. case in the Ontario Superior Court of Justice, in line with the Companies’ Creditors Arrangement Act. Voyager Digital has claims against Three Arrows Capital of more than $650 million.

The crash that started it all

Those tuned into the cryptocurrency world are aware of the recent collapse of Bitcoin and other cryptocurrencies. Part of the descent has been owed partly to the implosion of Terraform Labs’ support coin, the Terra (LUNA). Between May 11 and 12, 2022, LUNA crashed from $120 to $0.02, representing a 99.9 percent drop in the span of just 48 hours. It continued crashing further, dropping to $0.00000112. As a result of the crash, a stock market correction took place, bringing the SPX under 4,000. 

Terraform Labs’ stablecoin, TerraUSD, did not crash nearly as much as LUNA but still took a hit, descending from $1 to $0.30. Stablecoins are pegged to more “stable” assets, such as the U.S. dollar or commodities like gold. The purpose of stablecoins is to combat the volatility that is often associated with cryptocurrencies. However, the recent crash affecting both coins and the market at large demonstrates that volatility is the price investors must be prepared to pay if they want to play.

A material change occurred that affected Voyager Digital’s business

Voyager Digital is a cryptocurrency lender based in the United States. It was founded in 2018 to help enhance cost-efficiency, choice, and transparency in the marketplace. It allows for the secure trading of over 100 different crypto assets through its mobile application.

Voyager Digital provided an unsecured loan of more than $650 million to Three Arrows Capital, a cryptocurrency hedge fund based in Singapore. Three Arrows was hit particularly hard by the recent LUNA crash and has experienced significant challenges in recent months. A class action was filed against Three Arrows on June 17, 2022, in the United States District Court for the Northern District of California. On June 22, 2022, Three Arrows Capital defaulted on the Voyager Digital loan.

On June 27, 2022, Three Arrows Capital was ordered by a court in the British Virgin Islands to liquidate. The same day, Voyager Digital issued a notice of default against the hedge fund for failure to make payments on its loan of more than $650 million worth of Bitcoin and USD Coin. When Voyager Digital declared bankruptcy in July 2022, its CEO attributed the financial trouble in part to Three Arrows Capital’s inability to repay its loan. The proposed class action here in Ontario alleges that investors were not made aware of this until it was too late.

Reporting issuers have ongoing disclosure requirements

Ontario’s Securities Act is the provincial legislation that places requirements on companies operating in securities, including stocks, bonds, and options. Reporting issuers are those listed and posted for trading on any exchange recognized by the Ontario Securities Commission.

Under the Securities Act, companies that are reporting issuers in Ontario are required to make certain information regarding their financial status and activities publicly available on a regular basis. For instance, if there is a change in business, such as an unpaid loan causing economic strife, disclosure is required by the following section:

Publication of material change

75 (1) Subject to subsection (3), where a material change occurs in the affairs of a reporting issuer, it shall forthwith issue and file a news release authorized by a senior officer disclosing the nature and substance of the change. […]

Report of material change

(2) Subject to subsection (3), the reporting issuer shall file a report of such material change in accordance with the regulations as soon as practicable and in any event within ten days of the date on which the change occurs.

Is cryptocurrency a security?

There is some question as to whether cryptocurrency is considered a security. Although some have considered cryptocurrencies to be merely a commodity, the Securities Exchange Commission Chair, Gary Gensler, has explained:

“If somebody is raising money selling a token and the buyer is anticipating profits based on the efforts of that group to sponsor the seller, that fits into something that’s a security.” 

Regardless of whether cryptocurrency is considered a security in Canada, Voyager Digital is a reporting issuer for the purpose of the Securities Act. This is because shares of the company are listed on the Toronto Stock Exchange (TSX) and Frankfurt Stock Exchange (FRA) and are also traded via Over-The-Counter markets (OTC). As a result, Voyager Digital has the duty of providing ongoing disclosure to its investors. Since the lender’s bankruptcy filing, trading of its common shares was halted on July 7, 2022.

Bader Law in Mississauga Provides Innovative Cryptocurrency and Fintech Legal Solutions

The business lawyers at Bader Law have decades of experience assisting with corporate structuring, financing, and secured lending throughout Mississauga and the Greater Toronto Area. We provide dynamic business law advice and solutions for companies working within the crypto and fintech sectors. To speak with a member of our talented business law group, contact us online or at 289-652-9092.

Cryptocurrencies have been on the rise in popularity. Cryptocurrencies are digital currencies that make use of blockchain technology to allow for fast and anonymous payments online. Blockchain technology is a decentralized archive in which transactions are made public for all users to see. This allows parties to make peer-to-peer transactions without the need for a third party (such as a bank) to approve or verify the transaction. In Canada, cryptocurrency has become an increasingly popular form of payment online and can also be used as an investment opportunity.

What is cryptocurrency?

Cryptocurrencies are a form of digital or virtual currency that uses cryptography for security or authentication purposes. Cryptocurrencies are transferred between parties through an electronic system. They also use blockchain technology, which refers to a group of blocks that are linked together via cryptography. These blocks are stored in a manner that makes them secure from external tampering and revision so they will always display an accurate archive of transactions.

Cryptocurrencies are increasing in popularity

Cryptocurrencies have become popular tools for online purchases and transfers, particularly because they offer the anonymity that cash-based transactions do not provide. Internationally, dealing in cryptocurrency can help overcome the hurdles of sending money from country to country or the need for currency exchange. You can buy cryptocurrencies using your credit card or PayPal account, trade them on an exchange like stock markets or keep them on your computer in what’s known as a “wallet.”

You can send and receive payments using cryptocurrency just like you would with cash. However, since it is not tied to any specific country, there are minimal regulations regarding how you should report gains or losses when you sell your coins for fiat money, like Canadian dollars.

Canada is a leader in the cryptocurrency space

Canada is one of the few countries that has not banned cryptocurrency and is considered to be a leader in the cryptocurrency market. Recently, Canada became one of the first countries to make a legally recognized crypto-to-fiat exchange with its own version of Bitcoin called CAD-Coin. CAD-Coin was developed by Canadian banks to let people buy and sell all kinds of goods using cryptocurrencies that have been converted into dollars at rates set by those banks. This allows Canadians to purchase products from select vendors using their cryptocurrency assets without having to go through third parties like PayPal or credit cards.

Cryptocurrency and taxes in Canada

In Canada, cryptocurrency is treated as a commodity under the Income Tax Act. The CRA considers cryptocurrency to be a “digital representation of value” and therefore a taxable commodity. Income that comes from cryptocurrency is typically treated like business income or capital gains. Similarly, losses are treated as business losses or capital losses.

However, if you use cryptocurrency for personal use (as in, to buy goods or services) then it would be considered a barter transaction and not subject to tax. A barter transaction is when two parties agree to carry on a transaction without legal currency.

Each type of cryptocurrency, from Ethereum and Bitcoin to Solana and Dogecoin, is treated as separate digital assets. They must therefore be valued separately.

The difference between business income and capital gains

There are a few ways to dispose of cryptocurrency, but certain methods come with tax consequences compared to others. Any income you get from disposing of cryptocurrency, such as by selling it or converting it to government-issued currency, may be taxable as either business income or a capital gain.

Distinguishing the type of income is important because capital gains are only included in income at 50%, whereas business income is fully included. If you are in the process of starting a business, note that you may not be considered to have actually set it up yet. Once you start making profits in a business, they are business income and cannot be considered capital gains.

The CRA has outlined a few factors to consider in deciding whether income acquired from the disposition of cryptocurrency is business income. They are as follows:

• Promotion of a product or service.
• Intention to make a profit, even if unlikely to do so short-term.
• Carrying on activity for commercial reasons.
• Undertaking activities in a businesslike manner.

How to obtain cryptocurrencies

There are two common ways in which cryptocurrencies are acquired. The most common is by purchase through a cryptocurrency exchange. Another way is to earn cryptocurrency by mining.

Mining involves the use of a computer to confirm the authenticity of cryptocurrency transactions. When miners are paid for this work, they receive payment in the cryptocurrency they are validating. Income obtained by mining is not considered business income if it is done as a hobby. If this hobby is pursued in a way akin to business, however, the income will be taxed accordingly.

Cryptocurrency is changing financial markets worldwide

Whether or not you decide to invest in cryptocurrencies, one thing is for certain: they are here to stay. They have exploded in popularity since the Government of Canada first addressed them in 2014 through the lens of anti-money laundering legislation.

Although investing in cryptocurrencies comes with some risk, that may quickly be changing as digital currencies continue to be adopted in markets all around the world.

Contact Bader Law to ensure all cryptocurrency income is reported correctly

It’s important to remember to report all of your business income and/or capital gains from cryptocurrency come tax season. If you fail to report, you may be left with penalties and interest down the line.

The business lawyers at Bader Law have decades of experience in establishing new legal identities for businesses throughout Mississauga and the Greater Toronto Area, be it a private corporation, a limited liability partnership, a sole proprietorship, or a corporation needing to make a private placement of securities. Contact us online or at (289) 652-9092.

The world of finance is rapidly changing. Fintech, cryptocurrency, and blockchain technology is changing the way companies do business across all sectors and industries. As a result, these areas of digital finance are facing increased regulatory oversight in Canada and worldwide.

On April 29, 2022, Alberta’s Financial Innovation Act received Royal Assent and will come into effect on a date set by proclamation. This Act creates a “regulatory sandbox” that will be a significant step forward for the Canadian cryptocurrency and financial technology (fintech) sector.

Crypto becoming increasingly regulated in Canada

Earlier this year, we wrote about the increased regulation placed by the Ontario Securities Commission on Ontario businesses offering crypto trading services. We have also reviewed the recent guidance issued by Canadian regulators regarding acceptable marketing practices for businesses that operate crypto trading platforms. Additionally, crypto businesses falling under the Money Services Businesses regulatory category in Canada are governed by strict registration requirements. 

Regulatory sandboxes are another form of oversight that is being considered at both the federal and provincial levels in Canada. We have written about Bill C-249, which is intended to enable the creation of a national regulatory framework for the crypto asset framework. In March 2022, Alberta proposed its own regulatory sandbox through the creation of Bill 13, the Financial Innovation Act. 

What is a “regulatory sandbox”?

A regulatory sandbox allows companies to experiment with new products or services. Companies participating in the sandbox are afforded some flexibility and relief from regulatory requirements that may not be strictly applicable to innovative products or services and that may create unnecessary burdens and stifle creativity. 

While these companies face some relaxed regulation, sandbox initiatives always require participating companies to meet regulatory terms and conditions aimed at protecting potential investors or consumers. 

Alberta passes provincial crypto regulatory sandbox

Bill 13 received Royal Assent in Alberta on April 29, 2022. The Bill, now referred to simply as the Financial Innovation Act, establishes the first provincial regulatory sandbox for the finance and fintech sectors. The provisions of the Act provides these sectors with new opportunities to develop their businesses and create jobs at a time when the pandemic has created seismic shifts in the way people work. 

In its announcement about Bill 13, Alberta stated that the province believes that the proposed regulatory sandbox would “signal that Alberta is willing to work with and support innovators with cutting-edge products” and would open the door for Canadians to be able to access a wider variety of product and services. 

Koleya Karringten, the Executive Director of the Canadian Blockchain Consortium, previous stated that the Regulatory Sandbox is a “game-changer” for Canada’s blockchain industry and that the sandbox will “streamline the legislative and regulatory process, making it more viable for companies to bring their ideas and businesses to life”. 

Acceptance criteria – Ontario companies may participate

While the full list of restrictions will be set by regulation, Bill 13 as drafted imposes a list of minimum criteria that companies would need to meet in order to participate in the sandbox. These include:

• Physical presence requirement: Applicant companies would need to maintain an Alberta office or ensure that they have senior staff living in Alberta. This opens up opportunities for Ontario companies with remote workers in Alberta. 

• Financial services requirement: As the Financial Innvocation Act is aimed at fintech innovation, companies would need to offer financial products or services.

• Innovation requirement: Companies would need to justify the innovative aspects of their proposed products or services and demonstrate material innovation as compared to products and services already being offered in Alberta. The sandbox is not intended for existing offerings already available to consumers in Alberta.

• Business plan requirement: Companies applying for the sandbox must have a clear path forward, including a demonstrated understanding of how the company plans to test its products and services and how the company intends to eventually achieve compliance with regulatory requirements. 

• Consumer protection requirement: Companies would need to be able to prove that their fintech product or service is a net benefit to the public and that it is able to operate in a “safe and sound manner” with “reasonable consumer protection arrangements”. 

Oversight, offences, and penalties

While part of the sandbox, companies will be expected to provide annual corporate information returns to the government, which will provide key corporate information, such as financial statements and director information. 

In addition to annual returns, the government will also have the power to inspect and examine entities for operational matters, including:

• Sound business and financial practices
• Management procedures and standards
• Compliance with terms, conditions or restrictions that were imposed on the company as part of its acceptance into the sandbox

If a company fails to comply with any of the sandbox requirements and, in so doing, contravenes any provision of the Financial Innovation Act or its regulations, it can face steep penalties. The monetary fines increase after a first offence and can add up quickly if imposed per violation. A company’s first conviction can result in a $100,000 for the first conviction, while each subsequent conviction can carry a $200,000 fine.

Alberta regulatory sandbox offers opportunity for adoption by Ontario

The Alberta government has indicated that it will begin accepting applications under the Financial Innovation Act on July 4, 2022. 

While the sandbox is an Alberta initiative, it is clear that Ontario companies can also participate. Fintech, unlike many other industries, is exceptionally well suited for remote or virtual work environments, and many Ontario innovators could benefit from pursuing an application. 

Further, Alberta’s sandbox could be the model for the regulatory sandbox recommended to Ontario’s premier Doug Ford by the Capital Markets Modernisation Taskforce in its 2020 Consultation Report. 

Contact Bader Law For Experienced Advice on Crypto Business Matters

Bader Law understands the complexities of the cryptocurrency and fintech sectors and provides reliable business law advice to companies looking to expand into these new areas. Our business lawyers provide dynamic solutions for crypto and tech companies in Mississauga and throughout the Greater Toronto Area. To schedule a consultation with a member of our team, contact us online or call 289-652-9092.

This is the fourth entry in our series of blogs examining cryptocurrencies’ regulatory and business landscape in Canada and Ontario. In our first entry, we wrote about the status of crypto trading platforms in Canada and the tighter requirements imposed for Ontario businesses offering Ontario residents access to crypto trading by the Ontario Securities Commission. Our second post reviewed the recent guidance issued by Canadian Regulators outlining the regulatory requirements and parameters for acceptable marketing practices for businesses that operate crypto trading platforms. Our third post looked at registration requirements for crypto businesses that fall under the Money Services Businesses regulatory category in Canada.

Today’s post will look at Bill C-249, which recently passed its first reading in parliament. Bill C-249 was introduced by Member of Parliament Rempel Garner and is styled as the Encouraging the Growth of the Cryptoasset Sector Act. In a video clip posted to her official Twitter account, MP Garner stated that “Canada should be attracting billions of dollars in investment in the fast-growing crypto-asset industry” and acknowledges that “innovation in crypto-assets has the power to transform the economy and many other areas of society”. We will also take a short look at a recent Tax Tip issued by the CRA on crypto-mining.

Bill C-249 aimed at encouraging growth of the crypto-asset sector

Under the provisions of the Act, the Minister of Finance must, within 18 months, develop a national framework to encourage the growth of the crypto-asset sector. This framework must “focus on lowering barriers to entry into the crypto asset sector while protecting those working in the sector and minimizing the administrative burden.”

Public consultation requirement

An additional requirement is that the Minister of Finance also holds extensive consultations with industry participants and stakeholders in developing the above framework. Specifically, the legislation requires that the Minister of Finance consult with the industry experts who are nominated by Canadian provinces and territories, who have demonstrated experience working in the crypto-asset sector, and who are not part of one of the following groups:

• Individuals who, during the five years before the day on which this Act comes into force, that were required to file a return under subsection 5(1) or 7(1) of the Lobbying Act; or who are
• Employees as defined in subsection 2(1) of the Public Service Employment Act or employees of a Crown corporation as defined in subsection 83(1) of the Financial Administration Act.

In addition, the Minister of Finance must allow soliciting comments from the general public. The intention behind the public and industry consultation period is to ensure that “the experts have a say in what policy they need, or don’t need” and that Canada remains an “attractive place to retain investment and talent while protecting those who work with crypto-assets”.  

What are crypto-assets?

If you have been following our recent series of crypto-focused blogs, you will have noticed the wide variety of definitions for crypto-assets. Bill C-249 approaches the term crypto-asset from a very wide lens. Under the current wording of the bill, crypto assets are:

“digital assets that are secured by means of cryptographic systems, including the blockchain system, that do not rely on a central authority and are based on algorithms agreed to by the majority of users”

The CRA uses that definition in its Tax Tip issued on February 9, 2022, but adds a cryptocurrency focus, stating that cryptocurrency is a type of digital asset that is independent, meaning that the cryptocurrency, unlike fiat currency (traditional currency) not rely on governments, central banks, or other central authorities for backing.

Cryptocurrency mining

In the Tax Tip, the CRA provides some information on the tax implications of crypto-mining activities.

As outlined in the Tax Tip, individuals or businesses that mine crypto are compensated in one of two ways. The first is income for creating a new cryptocurrency, and the second is a payment for the successful validation by the miner.

The CRA confirms that even a single mining transaction can be considered a business activity in the right circumstances. The distinction between crypto-mining being a hobby versus a business is a case-by-case determination.

If your crypto-currency mining is considered a business, your profits on the disposition or sale are considered business income and not capital gain. Buying a cryptocurrency to sell it for a profit may also be treated as business income.

Commenting on Bill C-249

The introduction of Bill C-249 has prompted an outpouring of support from respected names in the financial industry, including Kevin O’Leary, who stated that MP Garner finally gets that “Canada has almost unlimited [hydro-electric] power [and] could lead the world in green [crypto-currency] mining if they got their policy act together”.

If you are currently pursuing a business opportunity in the crypto-asset sector, or have a general interest in the space, MP Garner has created a website supporting Bill C-249, which has forms to submit your comments on the proposal and on what the framework should look like. The website, EmpowerCrypto.ca is accessible here.

Contact Mississauga Business Lawyers For Experienced Advice on Crypto Business Matters

Running a business involves an infinite number of daily and long-term decisions, all of which will impact your venture. The business law team at Bader Law has decades of experience in establishing new legal identities for businesses throughout Mississauga and the Greater Toronto Area, be it as a private corporation, a limited liability partnership, a sole proprietorship, or a corporation needing to make a private placement of securities. Contact us online or at (289) 652-9092.

This is the third entry in our series of blogs examining cryptocurrencies’ regulatory and business landscape in Canada and Ontario. In our first entry, we wrote about the status of crypto trading platforms in Canada and the tighter requirements imposed for Ontario businesses offering Ontario residents access to crypto trading by the Ontario Securities Commission (“OSC”). Our second post reviewed the recent guidance issued by Canadian Regulators outlining the regulatory requirements and parameters for acceptable marketing practices for businesses that operate crypto trading platforms.

Our latest article reviews the registration requirements for businesses that offer virtual currency exchange and virtual currency transfer services. These businesses are classified as Money Services Businesses (MSB) in Canada and, as such, must not only register as MSBs but also comply with the Proceeds of Crime (Money Laundering) and Terrorist Financing Act and associated Regulations, to help combat money laundering and terrorist activity financing in Canada.

Is your crypto business a money services business?

If your business deals with virtual currencies and offers either virtual currency exchange services or virtual currency transfer services, then your business is considered an MSB. Unlike the more narrow discussion of when crypto-currencies are and are not considered securities, which discussion we touched on in our previous crypto posts, for anti-money laundering, the Canadian Government has defined virtual currency in a very broad manner.

Virtual currency in Canada is any “digital representation of value, or the private key of a cryptographic system that enables access to a digital representation of value, that can be used for payment or investment purposes.” Whether the virtual currency does not play into the general requirement that any business that deals with virtual currencies in Canada must register as an MSB.

The specific services that would result in a requirement to register as an MSB include the following:

Virtual currency exchange services include exchanging:

• funds for virtual currency
• virtual currency for funds, or
• virtual currency for another virtual currency.

Virtual currency transfer services include:

• transferring virtual currency at the request of a client, or
• receiving a transfer of virtual currency for remittance to a beneficiary.

Federal registration requirements

To legally operate an MSB in Canada, you need to register with Canada’s Financial Transactions and Reports Analysis Centre (FINTRAC).

FINTRAC is “Canada’s financial intelligence unit. Its mandate is to facilitate the detection, prevention and deterrence of money laundering and the financing of terrorist activities while ensuring the protection of personal information under its control.”

FINTRAC requirements for MSBs

FINTRAC requirements generally fall within six general categories. We provide a short summary of each category below:

Compliance Program

Every MSB operating in Canada must create a detailed Compliance Program. A properly written Compliance Program outlines and therefore enables the MSB to meet all required reporting, record-keeping, client identification and other know-your-client requirements under the PCMLTFA and associated Regulations. As part of creating a Compliance Program, an MSB will also need to:

• Appoint a Compliance Officer
• Conduct Risk Assessments
• Create a Compliance Training Program for Employees

Know Your Client

MSBs must comply with Know-Your-Client regulations, which include verifying client identities, keeping track of the possible involvement of third parties, identifying politically exposed foreign persons and other requirements.

Reporting

MSBs must keep careful and detailed records of all transactions that they facilitate and report suspicious transactions, transactions involved in suspected terrorist activity, and large virtual currency transactions. Like with fiat currency, large virtual currency transactions are defined as those with a value equivalent to $10,000 CDN or more.

Record Keeping

FINTRAC outlines eleven separate categories of records that MSBs must keep in an easily accessible place and format to enable an MSB to produce the relevant record for FINTRAC within thirty days of a production order.

Travel Rule

The Travel Rule outlines the type of information that MSBs must keep relating to an Electronic Funds Transfer, including information relating to the sender and the recipient.

Ministerial Directives

Finally, MSBs must also comply with Ministerial Directives issued, including restrictions on transactions with a specific foreign entity or country.

Penalties for Non-Compliance with FINTRAC Requirements

FINTRAC is empowered by legislation to issue administrative monetary penalties. It is also empowered to refer matters of non-compliance to law enforcement which can lead to criminal penalties. Examples of possible criminal penalties include:

• Failure to report a large cash transaction or an electronic funds transfer: up to $500,000 for the first offence, $1 million for subsequent offences
• Failure to meet record-keeping requirements: up to $500,000 and/or 5 years imprisonment
• Failure to provide assistance or provide information during compliance examination: up to $500,000 and/or 5 years imprisonment.
• Disclosing the fact that a suspicious transaction report was made or disclosing the contents of such a report, with the intent to prejudice a criminal investigation: up to 2 years imprisonment.

You can view a list of penalties imposed by FINTRAC here. The highest administrative penalty imposed since late 2020 was an administrative monetary penalty of $701,250 imposed on ICBC (Canada) following three compliance violations in 2019.

Contact Bader Law For Experienced Advice on Crypto Business Matters

Running a business involves an infinite number of both daily and long-term decisions, all of which will impact your venture. The business law team at Bader Law has decades of experience in establishing new legal identities for businesses throughout Mississauga and the Greater Toronto Area, be it as a private corporation, a limited liability partnership, a sole proprietorship, or a corporation needing to make a private placement of securities. Contact us online or at (289) 652-9092.

This is the second entry in our series of blogs examining Canada’s cryptocurrencies’ regulatory and business landscape. Last week, we wrote about the status of crypto trading platforms in Canada and the tighter requirements imposed for Ontario businesses offering Ontario residents access to crypto trading by the Ontario Securities Commission (OSC). Our latest post will review the recent guidance issued by Canadian Regulators outlining the regulatory requirements and parameters for acceptable marketing practices for businesses that operate crypto trading platforms.

New Marketing Guidance for Crypto Trading Platforms

In September of 2021, the Investment Industry Organization of Canada and the Canadian Securities Administrators (CSA) issued Staff Notice 21-330 – Guidance for Crypto-Trading Platforms: Requirements relating to Advertising, Marketing and Social Media Use.

The CTP Marketing Notice is meant to guide Crypto Trading Platforms, dubbed CTPs by Canadian regulators, on how existing requirements under securities legislation and Investment Industry Organization of Canada rules relating to advertising, marketing and the use of social media may apply to these businesses.

What are Crypto Trading Platforms?

As we wrote about last week, Canadian regulators consider any entity “that facilitates or proposes to facilitate the trading of crypto assets that are securities (“Security Tokens”) or instruments of contracts involving crypto-assets (“Crypto Contracts”).”

Security Token or Crypto Contract?

The CSA has previously released guidance on what it considers to be the material differences between Security Tokens and Crypto Contracts. You can access the advice here.

Generally, Security Tokens would have the rights associated with common shares, such as voting rights or receiving dividends. These fall directly within the definition of a security and are immediately subject to securities legislation and the various securities acts across Canada.

As a side note, since Canada still does not have a national securities regulator, each province and territory has its own version of a Securities Act. The CSA issue notices based on the various provincial regulators’ consensus and aims to foster co-operation across Canada. However, as we wrote about in our previous post, various provinces can take action on their own — the OSC requiring Ontario CTPs to initiate immediate regulatory contact is an example of a provincial regulator acting on its own strategic goals.

In contrast with Security Tokens, Crypto Contracts are not always subject to securities regulation. However, Canadian regulators have found that most crypto trading platforms do not immediately entitle a buyer/seller to a crypto asset. Generally, transactions on a crypto-trading platform involve a contract or instrument to purchase, sell, or deliver an underlying crypto asset. The CSA has taken the view that where the contract for the purchase or sale of the underlying crypto asset does not result in an obligation to make immediate delivery of the underlying crypto asset, and/or immediate settlement of the purchase/sale transaction.

Marketplace CTPs

One of the key distinguishing features of a Marketplace Platform is connecting multiple buyers and sellers.

Dealer CTPs

One of the key distinguishing features of a Dealer Platform is that it does not connect buyers and sellers, but rather is the counterpart for every trade. So, on a Dealer Platform, any trade you place is with the CTP itself and your orders never interact with another trader’s orders.

Scope of the New Marketing Guidance for CTPs

The CTP Marketing Notice reminds operators of CTPs and entities pursuing CTP registration that existing securities legislation places limits on what are acceptable marketing practices, in particular, CTPs should consider the following:

1. Whether a CTP is making statements in advertising and marketing materials that could be considered false or misleading
2. concerns over the use of gambling-style contests, promotions or schemes, such as the offering of bonuses or rewards based on the level of trading that may encourage excessive trading by retail investors
3. compliance and supervisory challenges when using social media to promote CTPs, and
4. complying with securities legislation generally

Prohibition on False or Misleading Statements

In the CTP Marketing Notice, the CSA confirms that there are numerous provisions in securities law and IIROC trading rules that apply to CTPs and that prohibit false or misleading statements in advertising or marketing materials.

In the notice, the CSA provides the following examples of statements or materials that would be considered improper:

• statements that suggest that a CTP is registered under securities legislation where this is not the case;
• statements 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 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.

Specific Warning Against Gambling Style Advertising for CTPs

In its notice, the CSA provides a specific warning against gambling-style advertising and marketing. The CSA includes under that general heading any 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.

As an example of inappropriate marketing, the CSA points to a promotion that involves a bonus scheme offering a financial reward or a bonus interest in a particular type of crypto asset for the first 500 investors who take action within the next 24 hours.

The CSA states that it is concerned that some of these strategies may inappropriately encourage investors to engage in excessively risky trading, taking on risks that they would normally avoid.

Challenges of using Social Media for Marketing and Promotional Activities

As entities regulated under securities legislation and subject to IIROC trading and member rules, CTPs need to be aware that they are obligated to keep detailed records of their business activities, financial affairs and client transactions. This includes tracking all the methods they use for communicating with clients and the general public for business purposes. Therefore, CTPs are obligated to keep detailed social media activity records and create and maintain a system or process for legislation-compliant record retentions with extensive retrieval capabilities.

Examples of Crypto Trading Platforms

There are currently six CTPs that are registered in Ontario. A list of current registrants can be found here. These include CoinBerry, Netcoins, and Wealthsimple. All the CTPs currently registered are Dealer Platforms, and to date, no Marketplace Crypto Trading Platforms have yet obtained registration in Ontario.

Contact Mississauga Business Lawyers For Experienced Advice on Crypto Business Matters

The business law team at Bader Law has decades of experience in establishing new legal identities for businesses throughout Mississauga and the Greater Toronto Area, be it as a private corporation, a limited liability partnership, a sole proprietorship, or a corporation needing to make a private placement of securities. Contact us online or at (289) 652-9092.

With cryptocurrencies, such as Bitcoin and Ethereum, hitting all-time highs last year, cryptocurrency trading has been a hot topic with companies of all sizes seeking ways to enter the increasingly competitive space.

In the last 12 months, securities regulators in Canada have taken proactive steps to regulate crypto trading platforms to protect Canadian investors. In light of this, we will be writing a series of blogs exploring the status of cryptocurrencies in Canada and Ontario, looking at everything from platform registration requirements to marketing requirements and recent regulatory trends.

In our first series, we focus on Crypto Trading Platforms. In March of 2021, the Canadian Securities Administrators (CSA) made a splash in the global crypto community by announcing their intention to bring crypto trading platforms under the direct oversight of securities regulators in Canada by using the “Guidance for Crypto-Asset Trading Platforms: Compliance with Regulatory Requirements”.

CSA Guidance on Crypto Trading Platforms

The CSA Guidance included an overview of how existing regulatory requirements may apply to Crypto Trading Platforms and areas where there may be flexibility in how the requirements apply to Crypto Trading Platforms, provided the key risks are addressed.

The CSA Guidance also noted that as the crypto industry in Canada is still developing, a wide variety of Crypto Trading Platforms models are emerging. The CSA stated that depending on the business model and activities conducted by a Crypto Trading Platform and the risks it creates, the regulatory treatment of one Crypto Trading Platform may differ from another.

Finally, the CSA Guidance established an interim process that would allow Crypto Trading Platforms to operate as they fully integrated into the Canadian regulatory structure. The interim process outlined involved a two-year interim transition period between an initial application to CSA provincial members and formal registration under the appropriate Crypto Trading Platforms category.

No Interim Period for Ontario Crypto Trading Platforms

In addition to the above, the Ontario Securities Commission (OSC) has issued its notice stipulating that any Crypto Trading Platforms operating in Ontario or offering services or products to Ontario residents, must apply to the OSC immediately and begin the registration process in Ontario or withdraw from Ontario. This has led to an immediate exodus of CTP providers from Ontario and has led the OSC to pursue regulatory actions against a handful of unregistered platforms that did not initiate regulatory conversations with the OSC. The OSC has issued investor warnings against numerous unregistered platforms. You can view the warnings here.

What is a Crypto-Trading Platform?

The CSA defines a Crypto Trading Platform, or Crypto Trading Platforms, as a platform that facilitates or proposes to facilitate the trading of:

• crypto-assets that are securities (Security Tokens), or
• instruments or contracts involving crypto assets.

Types of Crypto Trading Platforms

The CSA’s notice distinguishes between two categories of CTPs, Marketplace Platforms and Dealer Platforms. These categories also have subcategories depending on the CTPs’ structure and service and product offerings.

Marketplace Platforms

One of the key distinguishing features of a Marketplace Platform is connecting multiple buyers and sellers. Therefore, when you trade on a Marketplace Platform, you potentially interact with other individual traders.

The formal CSA Guidance for what makes a CTP a Marketplace Platform is as follows:

• constitutes, maintains or provides a market or facility for bringing together multiple buyers and sellers or parties to trade in Security Tokens and/or Crypto Contracts;
• brings together orders of Security Tokens and/or Crypto Contracts of multiple buyers and sellers or parties of the contracts; and
• uses established, non-discretionary methods under which orders for Security Tokens and/or Crypto Contracts interact with each other and the buyers and sellers or parties entering the orders agree to the terms of a trade.

If a Marketplace Platform also regulates its members, it may be considered an Exchange Marketplace Platform. This would be akin to a traditional stock exchange model, where dealers represent the individual traders and the dealers are the actual members of the Exchange. This is how most international exchanges operate. Retail traders go through an intermediary and the Exchange sets the rules for how the intermediary must operate to obtain access to the Exchange.

Dealer Platforms

One of the key distinguishing features of a Dealer Platform is that it does not connect buyers and sellers but rather is the counterpart for every trade. So, on a Dealer Platform, any trade you place is with the CTP itself, and your orders never interact with another trader’s orders.

The formal CSA Guidance for what makes a CTP a Dealer Platform and not a Marketplace Platform is as follows: as follows:

• it only facilitates the primary distribution of Security Tokens, and
• it is the counterparty to each trade in Security Tokens and/or Crypto Contracts, and client orders do not otherwise interact with one another on the CTP.

The CSA Guidance does acknowledge that CTPs that are Dealer Platforms may also be engaged in other activities or perform other functions that marketplaces typically do not undertake, such as:

• onboarding of retail clients onto the CTP
• acting as agent for clients for trades in Security Tokens or Crypto Contracts, and
• offering custody of assets, either directly or through a third-party provider.

In Canada, trading surveillance is handled by the Investment Industry Regulatory Organisation of Canada (“IIROC”), which regulates broker-dealers. CSA Members regulate marketplaces and oversee the activity of IIROC. Dealer Platforms are expected to seek registration with IIROC either immediately, if operating or interacting with clients in Ontario, or within the interim 2 year period from April 2021.

Examples of Crypto Trading Platforms

There are currently six CTPs that are registered in Ontario. A list of current registrants can be found here. These include CoinBerry, Netcoins, and Wealthsimple. All the CTPs currently registered are Dealer Platforms, and to date, no Marketplace Crypto Trading Platforms have yet obtained registration in Ontario.

Contact Mississauga Business Lawyers For Experienced Advice on Crypto Business Matters

Our business lawyers assist crypto start-ups with business structure and licensing matters. The business law team has decades of experience in establishing new legal identities for businesses throughout Mississauga and the Greater Toronto Area, be it a private corporation, a limited liability partnership, a sole proprietorship, or a corporation needing to make a private placement of securities. Contact us online or at (289) 652-9092.