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The RCMP has provided the country’s financial institutions with a list of individuals it says have ties to anti-government protests, instructing banks and cryptocurrency exchanges to cease transacting with them.

The move comes after the federal government brought in emergency measures in a bid to end protests that have jammed the core of the nation’s capital for weeks.

A letter sent to banks names fewer than 20 people the national police service has identified as being involved in illegal acts related to the demonstrations, according to a source who has reviewed the document. It describes the RCMP’s “first disclosure of information” to financial institutions and includes pictures and summaries with details about the people, some of whom are identified as main organizers of the protests.

The Globe and Mail is not identifying the source because they are not authorized to discuss correspondence with the RCMP.

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A separate letter to several cryptocurrency exchanges obtained by The Globe notes that the RCMP and the Ontario Provincial Police are investigating cryptocurrency donations in relation to illegal acts falling under the scope of the Emergencies Act.

The letter tells the exchange operators to “cease facilitating any transactions” with more than 30 specific cryptocurrency wallet addresses that it lists, adding: “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 federal government invoked the Emergencies Act on Monday, giving law enforcement additional powers to respond to continuing blockades and protests against pandemic restrictions. An emergency order published on Tuesday night expanded financial institutions’ authority to freeze accounts and cut off financial services to those involved in the blockades without obtaining a court order. The standoff put greater scrutiny on Canada’s cryptocurrency sector after supporters of the protests turned to alternative forms of fundraising.

The Canadian Bankers Association (CBA) confirmed that the RCMP sent letters to financial institutions on Wednesday that name people the police service identifies as “designated persons” – the legal term the government’s emergency order uses for those participating in illegal acts blocking roads, bridges and other critical infrastructure.

Although the letters put pressure on the financial institutions to act, it is up to each one to decide whether any particular client meets that threshold, and whether to freeze funds or block transactions.

“All financial service providers, including banks, covered by the federal Emergencies Act will need to diligently implement the required measures, as stipulated by the government in the corresponding Emergency Economic Measures Order, which are not expected to impact the vast majority of customers,” the CBA said in a statement.

An RCMP spokesperson declined to comment.

The temporary emergency measures the government imposed require financial institutions, including banks, credit unions and insurance companies, to cease dealing in financial services or facilitating transactions for people participating in activity deemed illegal under the Emergencies Act. The order also covers a broad swath of the financial sector that includes securities dealers, payment providers and crowdfunding platforms.

Each company must “determine on a continuing basis” whether they are holding property or funds for a designated person, the order says. Financial institutions must disclose those customers’ banking details and transaction records to the RCMP or the Canadian Security Intelligence Service, but can act on their own to freeze accounts and cut off services.

That leaves financial institutions trying to pull off a delicate balancing act: They must meet their duties under the emergency order and show government they are helping crack down on the illegal flow of funds, but avoid the perception that they are overreaching in choking off access to money for a subset of their customers.

On Wednesday, senior officials at Canada’s largest banks huddled in meetings to determine what their specific obligations are and how to fulfill them. But there was still confusion and several unanswered questions about how they should proceed even after the emergency measures took effect.

Torstein Braaten, chief compliance officer and head of regulatory affairs at Toronto-based cryptocurrency exchange Bitbuy, said the platform does not have an opinion on whether criminal activity is going on, but it intends to comply with the request from law enforcement.

“We are very concerned when an address gets identified as potentially associated with criminal activity. … It’s just unacceptable for us to be involved in that,” Mr. Braaten said.

He noted, however, that people can easily create new cryptocurrency wallets. “If the criminals know that their bitcoin address is known, then they will arguably just spin out another address,” he said.

Justin Hartzman, chief executive officer of CoinSmart Financial, a publicly listed crypto trading platform that received regulatory approval last year, said the compliance orders are “indiscriminately targeting the whole cryptocurrency ecosystem.”

“It is unfortunate,” Mr. Hartzman said in an e-mailed statement. “But the addresses associated with this alert have been widely disseminated to the entire crypto community here in Canada.”

Erica Pimentel, a professor in the Smith School of Business at Queen’s University who studies cryptocurrency and blockchain, described the move as “heavy-handed.”

“If the exchanges are in a custodial relationship where they effectively hold a client’s bitcoin for them, then this is tantamount to freezing someone’s bank account. It seems like an overreach to be able to freeze a person’s account,” she said.

Prof. Pimentel said she questions the effectiveness of asking cryptoexchanges to stop facilitating transactions with certain accounts. She said clients can simply turn to international companies, which are “unfettered” by the Canadian Emergencies Act.

“The client holds their own crypto, and the exchange is simply a vehicle that is being used to change one crypto for another,” Prof. Pimentel said.

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