Ottawa plans to crack down on virtual currencies such as bitcoin to make it harder for anyone to launder money or finance terrorists.
Tuesday’s federal budget outlined plans to update anti-money laundering and anti-terrorist financing regulations to account for virtual currencies.
The details were scarce, but proposed measures could allow the federal government to track any transfers worth $10,000 or more – something Ottawa can already do for hard currencies.
The new rules come after the Senate committee on banking, trade and commerce released its final report on crime and terrorist financing in March, 2013, capping off a five-year review. At the time, bitcoin was almost unknown.
The government said Tuesday its new amendments for virtual currencies are designed to “strengthen Canada’s anti-money laundering and anti-terrorist financing regime and improve Canada’s compliance with international standards, while minimizing the compliance burden.”
Tougher virtual currency restrictions come in the same week that bitcoin came under intense scrutiny, after a bug was found in its software. In response, the Japanese company that served as bitcoin’s largest exchange halted customer withdrawals, and the currency quickly lost more than 25 per cent of its value.
Ottawa also vowed to make online casinos subject to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, and to give the Financial Transactions and Reports Analysis Centre of Canada up to $12-million over five years to improve the Centre’s analytics system.