Canada Is Ordering Crypto Exchanges to Blacklist ‘Freedom Convoy’ Addresses

“Bitbuy has reviewed the Emergency order and received a number of crypto addresses from law enforcement,” Torstein Braaten, head of regulatory affairs for Canadian crypto exchange Bitbuy said in an emailed statement. “We will conduct our own investigations and surveillance as part of our Compliance program and report as required by the Emergency order and FINTRAC [Financial Transactions and Reports Analysis Centre] requirements.”

Braaten noted that exchanges like Bitbuy are already beholden to FINTRAC and this order doesn’t fundamentally change any of the usual surveillance and reporting that the firm conducts. “That being said, it may bring attention that some unregulated crypto trading platforms may be conducting business in Canada outside of the rules required by Canadian firms,” Braaten said.

A spokesperson for Bitbuy said that the exchange was advised by the RCMP not to share the document. A copy of the document obtained and reported on by the Globe and Mail shows that more than 30 addresses were singled out by the agency in the order, the paper reported. “Any information about a transaction or proposed transaction in respect of these address(es), is to be disclosed immediately to the Commissioner of the Royal Canadian Mounted Police,” the letter states, according to the Globe and Mail.

“At the end of the day, you can try and do a peer-to-peer situation and try and skirt around a regulated entity like ourselves, or go to a non-regulated entity and hope they do it, but it’s going to be tracked anyway,” Hartzman said, referring to the recent arrest of a couple accused of conspiracy to launder billions of dollars in Bitcoin stolen in a 2016 hack. “At some point, somewhere, someone is going to hit a centralized exchange, and there’s going to be an account associated with that.”

Coinberry, another crypto exchange in Canada, told Motherboard that it received guidance banning regulated exchanges from interacting with addresses linked to the protest. 

“Coinberry has recieved communications that appear to embody a request of this nature,” CEO Andrei Poliakov said in an email. “At this time, we are evaluating our options and the basis with which this request has been made. Coinberry will continue to prioritize our users’ right to privacy and will make every effort to protect our users from any form of overreach or unlawful action which may infringe on their rights.” In a follow-up email, Poliakov said he could not elaborate further on the source of the request or its nature. 

“It is unfortunate that the Emergency Economic Measures Order is indiscriminately targeting the whole cryptocurrency ecosystem,” Hartzman said. “The addresses associated with this alert have been widely disseminated to the entire crypto community here in Canada and have reportedly been reported to the blockchain monitoring softwares that service the industry worldwide. We will cooperate with the OPP and the RCMP and fulfill our obligations, if any, under the Emergency Economic Measures Order.”

So far, the plan to distribute Bitcoin to protesters (which is still taking shape) has focused on getting recipients to create Bitcoin wallets and having the funds sent directly to them. The last update from the person leading the plan’s construction is that funds could be delivered “mid next week,” they said in a tweet. 

Update: This story was updated with additional comment from Coinsmart CEO Justin Hartzman.