Bitcoin, ether markets ‘best support operations,’ for public crypto asset funds: CSA

Currently, public crypto asset funds can only invest in bitcoin and ether

article-image

Kanchanara/Unsplash modified by Blockworks

share

Canada updated its guidance for investment funds investing in crypto. 

The notice outlines Canada’s expectation for funds either directly or indirectly investing in crypto assets. As of April, 22 public crypto asset funds have less than 3 billion Canadian dollars in net assets according to Canada’s Securities Administrators.

CSA does play favorites in the notice, stating that it believes bitcoin and ether markets “best support the operations of Public Crypto Asset Funds at this time without compromising investor protection.” Currently, bitcoin and ether are also “the only crypto assets accepted as investments for Public Crypto Asset Funds.”

“In the future, greater institutional support and mainstream adoption of other crypto assets may result in those crypto assets becoming suitable investments for publicly distributed investment funds,” CSA wrote.

The notice also brings up the possibility of a regulated futures market, which would provide “support for the proper valuation of a Public Crypto Asset Fund that invests in that crypto asset, along with other operational benefits.”

“CSA staff consider that the presence of a regulated futures market for a particular crypto asset promotes greater price discovery, a view that is supported by recent research,” they wrote.

Read more: Royal Bank of Canada Allocators Cut Most Crypto Stocks Last Quarter

The CSA staff weighed in on crypto staking for public funds as well, stating that “depending on how it is conducted, staking may involve the issuance of a security or derivative.”

“CSA staff would therefore expect Public Crypto Asset Funds interested in staking crypto assets held in their portfolios to have established policies and procedures to assess whether any staking or similar activity involves the issuance of a security and/or derivative,” they continued.

Though any fund that proceeds to include staking should undergo “independent analysis” and consider regulatory and securities authorities “about whether staking conducted in the contemplated manner involves the issuance of a security and/or a derivative.”

The updates come after the collapses of multiple crypto firms — including FTX — sent crypto tumbling. Last November, the Ontario Teachers’ Pension Plan took a USD $95 million loss after FTX collapsed, wiping its stake in the crypto exchange.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Upcoming Events

Brooklyn, NY

SUN - MON, JUN. 22 - 23, 2025

Blockworks and Cracked Labs are teaming up for the third installment of the Permissionless Hackathon, happening June 22–23, 2025 in Brooklyn, NY. This is a 36-hour IRL builder sprint where developers, designers, and creatives ship real projects solving real problems across […]

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Research

article-image

Sponsored

The blockchain creates a fair environment where AI agents and users can access deep liquidity without MEV or other forms of value extraction

article-image

After upping its offer multiple times, Circle is finally trading on the NYSE

article-image

Circle goes public on the NYSE Thursday — here’s what to expect

article-image

Sponsored

WalletConnect is the default for secure, scalable onchain interaction — but this isn’t a peak, it’s the launchpad

article-image

Circle’s stock is expected to price at $31 and will go public on the NYSE Thursday