Ontario Securities Commission CEO Emphasizes Neutral Stance on Crypto Regulation

In a keynote address delivered on Oct. 6, Grant Vingoe, CEO of the Ontario Securities Commission (OSC), reaffirmed the regulator’s commitment to a technology-neutral approach to cryptocurrencies. During his speech before the Economic Club of Canada, Vingoe highlighted the OSC’s responsibility to maintain regulatory fundamentals equating to those applied to traditional stocks and bonds.

Vingoe emphasized that the majority of crypto-based entities fall under the OSC’s jurisdiction, suggesting a vigilant oversight as the cryptocurrency market continues to grow. He characterized Bitcoin (BTC) and Ether (ETH) primarily as commodities, while explaining that the trading arrangements made by platforms with investors are classified as securities.

“As securities regulators, none of the characteristics of crypto assets or their underlying technology, either positive or negative, drives our regulatory approach,” Vingoe said. He assured that the OSC is not in the business of picking winners and losers in investments but is committed to applying a uniform reasoning to all products entering the market.

Growing Interest in Crypto among Canadians

Highlighting the increasing interest in cryptocurrencies, Vingoe noted that over 30 percent of Canadians intended to invest in crypto assets within the next year. He acknowledged the challenges faced in barring non-compliant firms from offering services within Canada, particularly given limited enforcement resources.
“We know from our own research (being published later this month) that more than 30 percent of Canadians plan to buy crypto assets in the next year […] It is a challenge to bar non-compliant firms from offering services in Canada. With a limited budget and finite enforcement staff to cover our entire capital markets, there is only so much we can do. But we are making progress.”

OSC’s Enforcement Actions

In line with the OSC’s proactive measures, the regulator has taken enforcement actions against major crypto exchanges such as Bybit and KuCoin, citing violations of securities laws and their operation of unregistered trading platforms. Currently, nine companies are registered as recognized crypto businesses under the OSC, which includes prominent firms such as Fidelity Digital Assets, Newton Crypto, and Bitbuy.

Ultimately, Vingoe’s remarks suggest that while the OSC is working to foster an environment conducive to crypto innovation, it is equally committed to ensuring that these innovations comply with existing legal frameworks to safeguard investors and the financial system.