Canada tightens rules for verifying cryptocurrency holders

The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) tightened the rules for verifying the identities of clients of companies dealing in digital assets, according to the regulator’s site.

The changes affect both domestic and foreign firms providing financial services, as well as crypto-service providers. The guidelines take effect on 1 June 2021.

FINTRAC requires firms to verify clients’ identities in the following cases:

• receiving crypto assets valued at $10,000 or more within a 24-hour period;
• money transfers or transfers of digital currencies, as well as exchanges from $1,000;
• any suspicious transaction, regardless of amount.

The agency does not require verification when dealing with government agencies or their subdivisions. An exception also applies to companies with net assets of $75 million that are listed on the Canadian stock exchange.

Earlier, Canada required local and foreign companies offering exchanges and transfers, including digital currencies, to register with FINTRAC.

As reported in November 2020, the country’s tax authority required from the crypto exchange Coinsquare to hand over all user data from 2013 to verify tax compliance.

In March 2021, the agency obtained access to transaction details, transfer amounts, currency types and other information through a court order.

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