Canada enacts world's first Bitcoin law to bring it under national regulation

Canada has passed an ambitious plan to raise the regulation of Bitcoin to the national level by implementing a national law. People in the Bitcoin community are still debating whether such national supervision is needed at present because Bitcoin technology is not mature enough. From the external environment, the implementation of this bill is premature and will definitely affect Bitcoin-related business activities in Canada.

Christine Duhaime's Duhaime Act reviews Amendment C-31 and how it improves Canada's Proceeds of Crime (Money Laundering) and Terrorism Financing Act.

Regulating Bitcoin as an MSB - Bitcoin transactions, more specifically "virtual currency transactions", are fixed under Bill C-31, and Bitcoin businesses need to keep suspicious transaction records, verification procedures, suspicious transaction reports and register as money service businesses under the requirements of the PCMLTFA.

“Virtual Currency Transactions” Not Defined – The phrase “virtual currency transactions” is not defined, and it is unclear whether the defined term includes business activities that regulators have previously identified.

Register with FINTRAC - Bitcoin traders will be required to register with FINTRAC and if successful, they will have completed a full anti-money laundering compliance process.

Canada's Foreign Bitcoin Companies - Bill C-31 is more sweeping than other Canadian laws because it extends to: Companies with a business in Canada Companies with a place of business outside of Canada but directly serving persons or entities in Canada For example, Coinbase can only provide Bitcoin services in Canada if it registers with FINTRAC. Bitcoin companies that have a place of business in Canada (physically located in Canada) or have a R&R in Canada. Bitcoin companies that are located in Canada but provide services to persons or entities outside of Canada are exempt from Bill C-31.

Banning banks from opening accounts with bitcoin entities without a record - C-31 prohibits banks from maintaining or maintaining bitcoin dealer clients if they are not registered with FINTRAC. It is very important that bitcoin businesses understand what a correspondent banking relationship is and how it affects the banks that provide them with international services. Switzerland's richest and oldest bank, Wegelin & Co, closed last year after it violated international anti-money laundering regulations and the United States sued it for being a tax haven.