Crypto-asset firm CoinLaunch to settle with Ontario Securities Commission

Company investigated for trading in securities without registration

Crypto-asset firm CoinLaunch to settle with Ontario Securities Commission
iStock

The Ontario Securities Commission has approved a settlement agreement with crypto-asset consulting firm CoinLaunch, after the latter was found to have traded in securities without registration.

CoinLaunch, which chose to wind down its operations rather than initiate a registration process, will pay a fine of $30,000 and disgorge $12,223.06, a statement from the OSC said. CoinLaunch's former CEO Reuven Cohen has also agreed not to become or act as a director or officer of any company which engages in or holds itself out as engaging in trading securities, without the applicable registration or an exemption under Ontario securities law.

“If you are operating in the crypto-asset sector in Ontario, you must take steps to investigate and understand your obligation to comply with registration requirements under securities law,” said Jeff Kehoe, the OSC’s director of enforcement. “Businesses that choose to ignore this obligation should consider themselves on notice and will face more severe consequences.”

According to the OSC, between March 1, 2018 and September 30, 2018, CoinLaunch advertised and provided services to issuers of crypto-asset tokens, which included helping clients administer and promote crypto-asset token offerings. Together, these services were deemed acts in furtherance of trades, and required registration under Ontario securities law.

The commission said that despite its support mechanisms to foster Ontario's emerging crypto-asset sector and CoinLaunch’s knowledge of the registration requirements, the crypto-asset company did not seek registration. However, during the OSC's investigation, CoinLaunch cooperated with staff and took steps to remediate its conduct, such as taking down websites it had created for crypto-asset token issuers and ceasing its business relationship with token issuers.

Related stories

Free newsletter

Our newsletter is FREE and keeps you up to date on all the developments in the Ontario legal community. Please enter your email address below to subscribe.

Recent articles & video

Enhanced access to justice needs more than lawyers and paralegals: report

Criminal Lawyers’ Association filling mentor-gap with new online educational series

OBA's taxation law section names first female chairperson, Angela Salvatore

COVID-19 Economic Recovery Act to amend Justices of the Peace Act and Provincial Offences Act

OHRC tells Sudbury landlords they cannot discriminate based on receipt of public assistance

Windsor’s new associate dean to advance Indigenous law in legal education

Most Read Articles

Canadian Constitution Foundation suggests amendments to mandatory mask order in Ontario

Windsor’s new associate dean to advance Indigenous law in legal education

Ontario and Superior Courts of Justice embark on first phase of reopening

Patricia Kosseim shares her priorities as the new information and privacy commissioner