AMF institutes proceedings against two entities related to the crypto trading platform


Montréal – The Autorité des marchés financiers (the “AMF”) today filed with the Financial Markets Administrative Tribunal (the “Tribunal”) an application instituting proceedings (pdf - 185 KB)This link will open in a new windowUpdated on March 30, 2023 (in French only) against XT.COM Exchange (also doing business as XT Exchange and XT.COM) and BZ Limited.

An investigation by the AMF found that XT.COM Exchange and BZ Limited are facilitating transactions relating to cryptoassets through the website Web, which can be accessed in Québec and the rest of Canada. These entities could be subject to securities legislation as they are using the website to offer a number of financial products and services that could be securities or derivatives. However, they are not registered with or recognized by the AMF in any capacity whatsoever, have not prepared a prospectus subject to a receipt issued by the AMF and do not benefit from a discretionary exemption. Moreover, these entities are not pursuing registration with the AMF or any other member of the Canadian Securities Administrators (the “CSA”) in order to comply with securities legislation.

The Tribunal will have to rule on the evidence submitted to it.

Steps taken by the AMF and the CSA to protect investors

Over the past few years, the AMF has issued several notices, in partnership with the CSA, to implement a regulatory framework that promotes the protection of Québec consumers who invest through crypto trading platforms.

After launching a consultation on a regulatory framework for crypto trading platforms in 2019 and providing them with guidance on the application of legislation in 2020, the CSA outlined in greater detail the regulatory framework applying to their activities in 2021.

That same year, the CSA also provided crypto trading platforms with guidance relating to advertising, marketing and social media use.

On August 15, 2022, the CSA indicated that it expected platforms operating in Canada and pursuing registration with the CSA to provide a pre-registration undertaking. On December 12, 2022, the CSA published an update announcing that it would be strengthening this approach.

On February 22, 2023, the CSA announced that crypto trading platforms that operate in Canada while pursuing registration with the CSA were expected to provide an enhanced pre-registration undertaking to their principal regulator.

The Autorité des marchés financiers is the regulatory and oversight body for Québec’s financial sector.


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