Canadian Lawmakers Back Blockchain with Landmark Recommendations

Earlier this month, the Canadian House of Commons Parliamentary Standing Committee on Industry and Technology (INDU) published a comprehensive report that delves into the intricacies of blockchain technology and crypto use cases in Canada. Through the release of 16 different recommendations, we are pleased to see that the committee recognizes the benefits, utility, and value of blockchain technology.

As a company dedicated to updating the financial system to increase economic freedom and opportunity around the world, we welcome the promising recommendations within this report. As part of our ongoing International Expansion strategy, we are proud to highlight exciting developments at home in Canada, a key go-deep market for Coinbase globally. 

In March, we shared some key developments in our Canadian market, most notably that we have signed an enhanced Pre-Registration Undertaking. We are continuing to have productive conversations with policymakers, regulators, and customers while we build out our product offerings in Canada. 

We’re encouraged by the forward thinking approach of the parliamentary committee, and excited for the government’s response and continued collaboration with industry on several fronts. Here are some of the highlights from the report:

Recognizing Blockchain as an Emerging Industry

“That the Government of Canada recognizes blockchain as an emerging industry in Canada, with significant long-term economic and job creation opportunities.”

One of the key recommendations put forth by the committee is for the federal government to acknowledge blockchain as an emerging industry with significant long-term economic and job creation opportunities. By embracing blockchain technology, Canada can position itself as a global leader in this field, attracting investments and fostering innovation that will drive economic growth and create employment opportunities for its citizens. 

At Coinbase, we want to help drive that growth here; we are building out our team in Canada and are identifying opportunities to localize the Coinbase experience for our Canadian customers. 

Consumer Protection and Regulatory Clarity

“That the government of Canada should, in its efforts to improve consumer protection and regulatory clarity to the emerging and innovative field of digital assets, be guided by the principle that individuals’ right to self custody should be protected and that ease of access to safe and reliable on and off ramps should be defended and promoted.”

The committee’s emphasis on the importance of improving consumer protection and regulatory clarity on digital assets is critical, and is key to the success of this market. At Coinbase, we believe that crypto and blockchain technology have the ability to increase economic freedom and opportunity around the world, and we’re supporting this by building the most trusted crypto products and services, and supporting other builders to bring the next 1 billion people into crypto.  

Establishing a National Blockchain Strategy

To provide a clear policy direction and regulatory approach, the Government of Canada, in consultation with the provinces and stakeholders, should establish a national blockchain strategy. It’s promising to see the government outline a clear approach towards its development.

This strategy would serve as a roadmap for fostering innovation, supporting industry growth, and ensuring regulatory coherence across the country and highlighting the federal government’s important role in this emerging industry. By demonstrating support for the blockchain industry, Canada can position itself as an attractive hub for blockchain-related businesses and startups. 

We support multiple crypto startups in Canada through our venture arm, Coinbase Ventures. Coinbase Ventures is one of the most active corporate VCs by deal count and has invested in 400+ companies since launch in 2018. Coinbase Ventures has been active across Canada including investing in Dapper Labs the builders of CryptoKitties, NBA Top Shot & the Flow blockchain; Ledn, a financial services company built for Bitcoin & digital assets; and Tetra Trust, Canada’s first regulated custodian for crypto assets.

Innovative Regulatory Approach to Crypto and Stablecoins

“That the Government of Canada conduct innovative pilot projects using distributed ledgers to help strengthen the ecosystem and recognize up-and- coming businesses.”

Stablecoins, a type of cryptocurrency pegged to a stable asset like fiat currency, present novel regulatory considerations. The committee suggests that Canada adopts a distinct regulatory approach for stablecoins that acknowledges their differences from other cryptocurrencies. This tailored approach will enable effective oversight while promoting innovation.

The committee's report consists of more than 16 recommendations, all aimed at creating a thoughtful and forward-looking regulatory framework for the crypto and blockchain industry in Canada.  These are strong recommendations, and this report provides valuable insights to propel the nation forward. We are pleased that the committee understands that by recognizing blockchain as an emerging industry, prioritizing consumer protection, establishing a national strategy, and adopting a distinct regulatory approach to stablecoins, Canada can serve as a leader of the cryptoeconomy.