A Canadian House committee published a report on Wednesday providing 16 recommendations for how the nation’s government should regulate the blockchain industry – and they’re remarkably bullish.
Crypto exchange Coinbase praised the report, saying it was “encouraged by the forward-thinking approach of the parliamentary committee.”
Opening Canada to Crypto
In its first recommendation, The Parliamentary Standing Committee on Industry and Technology (INDU) asked that the Canadian government recognize blockchain as a growing industry with the potential to create jobs and foster economic growth.
The committee’s position mimics that of British Prime Minister Rishi Sunak, who spearheaded a newly passed bill to recognize crypto transactions as legitimate, regulated financial activity.
Canada’s Prime Minister Justin Trudeau has generally been dismissive of crypto, but his conservative political rival Pierre Poilievre is proudly pro-Bitcoin.
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The composition of the House committee is slightly left-leaning, but in some ways better resembles Poilievre’s position. Regarding the Bitcoin mining industry, the report suggests maintaining a “neutral and equitable position” to “foster a competitive digital asset mining environment” and “attract investments.”
It suggested investigating “equity between provinces” in its application of the Excise Tax Act to the mining industry to “ensure fair taxation.” In the United States, the Biden Administration recommended a debilitating 30% excise tax specifically targeted at miners in May (which has been cast aside for the time being).
Canadian lawmakers also advocated for protecting individuals’ “right to self custody”, and for providing ease of access to “safe and reliable on and off ramps.”
Coinbase Responds
Canada’s report was a breath of fresh air for Coinbase, which has frequently criticized the lack of regulatory clarity and hostility from the United States, where it is headquartered.
In a response letter, the company showed a particular fondness for the committee’s stablecoin recommendation, advocating a “unique regulatory approach” to such assets.
“Stablecoins, a type of cryptocurrency pegged to a stable asset like fiat currency, present novel regulatory considerations,” wrote Coinbase. “This tailored approach will enable effective oversight while promoting innovation.”
Canada’s current position on stablecoins is that they are securities – a position not shared by Coinbase CEO Brian Armstrong. The U.S. Securities and Exchange Commission (SEC) appears to also think they’re securities, given its recent lawsuit against Binance alleging that its stablecoin BUSD fits the bill.
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