TORONTO, March 8 The Ontario Securities
Commission, Canada's largest securities regulator, said on
Wednesday companies using blockchain technology in their
financial services may need to register or file a prospectus or
meet other regulatory requirements.
The OSC made the announcement in a notice that followed a
white paper on Monday addressing the role new technology like
blockchain will have on innovation in the industry.
It asked companies operating or planning a blockchain-based
product or service to contact LaunchPad, the regulator's
"sandbox" initiative that helps fintechs plan around compliance
Financial technology, or fintech, has transformed the
banking industry in recent years by using new technology to
provide more accessible, efficient, and often cheaper financial
Some fintech startups unfamiliar with complex securities
regulations may run into compliance issues, as was the case last
year with Toronto-based Lending Loop, which had to temporarily
pause its unlicensed operations. The company resumed operations
after receiving an exempt market dealer license.
Blockchain, or distributed ledger technology, is a
decentralized database considered very difficult to hack and is
the code that underpins bitcoin. The technology can be used in
trading, clearing and settling securities, and tracking
ownership of securities.
(Reporting by Solarina Ho; Editing by Paul Simao)