Canadian Securities Administrators Propose Amendments to Cryptocurrency Investment Fund Requirements
The Canadian Securities Administrators (CSA) proposed amendments to regulations on how public investment funds handle cryptocurrency assets, with the aim of further clarifying custody rights and rules for funds handling cryptocurrency assets. Under the amendment, only alternative investment funds and non-redeemable investment funds are allowed to directly purchase, sell, or hold cryptocurrency assets, while other mutual funds can only invest in these funds to obtain exposure to cryptocurrencies.
In addition, the invested assets must be listed on an exchange recognized by the Canadian securities regulatory authority and must be interchangeable. The assets must also be insured and stored in cold wallets, and the internal management of the custodian must be audited annually by public accountants. The proposal will solicit opinions publicly within 90 days, and then draft a consultation paper and consider a broader regulatory framework for cryptocurrency assets.
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