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Canadian cryptocurrency exchanges ordered to cease dealings with convoy-linked accounts

Cryptocurrency exchanges in Canada are being ordered by the RCMP to stop dealing with accounts suspected to have links to the anti-mandate convoy protest. A letter from police orders digital coin exchanges not to deal with accounts with suspected links to that movement, which has caused disruptions across the country, most notably at several border crossings and in Ottawa. The letter provides a list of accounts, according to an executive in that sector who has shared the details of that police instruction under condition of anonymity, which CityNews has granted. This week, Prime Minister Justin Trudeau invoked the Emergencies Act for the first time in Canadian history. In a statement, the Finance Ministry said the order “extends the scope of Canada’s anti-money laundering and anti-terrorist financing rules to cover crowdfunding platforms and the payment processors they use.” “This change covers all forms of transactions, including digital assets such as cryptocurrencies.” Related: Emergencies Act prohibits bringing children, food or fuel to ‘illegal’ anti-mandate blockades As police attempt to choke the convoy cash, chief executive Michael Vogel with Vancouver-based crypto platform Coinstream says it’s a reminder that using digital coins does not completely shield your identity or your dealings. At the time of his interview with CityNews, police had not contacted Vogel with that letter received by other companies in the cryptocurrency sector. “Cryptocurrency exchanges in Canada fall under FINTRAC [the Financial Transactions and Reports Analysis Centre of Canada], so every customer does have to be onboarded with some form of verification, proof of address, the kind of standard documents that you’d have to have when opening a bank account,” Vogel told CityNews in an interview. “Crypto customers aren’t anonymous in Canada, and if there’s an issue that comes up, there is a mechanism for law enforcement to reach out to crypto companies.” Related video: Emergencies Act invoked for first time We asked Vogel specifically about the perception that using cryptocurrency provides some special form of privacy protection. “Bitcoin is actually far less anonymous than cash, for example,” Vogel said. “Now, Bitcoin can be obfuscated, hidden in the cloud so to speak, but it can be traced through the on and off ramps. So, when someone does opt to cash out or buy their Bitcoins using a licensed exchange, it does leave a path behind them. We’ve even seen cases with the [Canada Revenue Agency] reaching out to major Canadian crypto exchanges, asking for records of crypto users just so they can see if people are paying taxes on their gains. That’s another angle that we’ve seen in the past in Canada.” CityNews reached out to a number of leaders in the cryptocurrency community, including Justin Hartzman, chief executive of Toronto-based CoinSmart. In a statement, he acknowledged a number of addresses have been widely disseminated to the entire Canadian crypto community under the Emergency Economic Measures Order. He goes on to say the addresses associated with this alert “have reportedly been reported to the blockchain monitoring softwares that service the industry world wide.” Related articles: Concerns over PM’s move to invoke Emergencies Act Prime Minister Justin Trudeau invokes Emergencies Act against convoy protests Hartzman feels the measure indiscriminately targets the whole crypto community, but says CoinSmart will fulfill any obligations under the Emergency Economic Measures Order. He added, “at CoinSmart we strongly believe in regulation, trust and transparency. We take FINTRAC compliance very seriously and have a robust monitoring system.” CityNews has contacted RCMP national headquarters for comment on this story.
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Written by: Denise Wong