CANADA Law and Practice Contributed by: Irbaz Wahab, Cloudhaus Law
1.2 Crypto-Assets 1.2.1 Property Considerations
acceptance, consideration (or in Quebec, cause), intention to create legal relations, capacity and suf- ficiently certain terms. Smart contracts that automate performance under a separate written agreement tend to be more straightforward to enforce, as the parties’ legal relationship is set out in a conventional contract and the code functions mainly as an execution tool. More uncertainty arises with purely code-based smart contracts where the full set of terms exists only as machine-readable code on a blockchain, which can complicate identification of counterparties and proof of intention to create legal relations. Provincial elec- tronic commerce statutes offer some support, with every province having legislation modelled on the Uni- form Electronic Commerce Act recognising electronic documents and signatures. However, these statutes were not drafted with autonomous self-executing smart contracts in mind and their application to pure- ly code-based arrangements has not been tested in Canadian courts. Canadian courts have not yet direct- ly decided a dispute on smart contract enforceability. Academic commentary suggests smart contracts can satisfy contract formation requirements in appropriate circumstances, but significant issues remain around interpretation, rectification and availability of equitable Canada has no formal self-regulatory organisation governing the blockchain industry. As a result, there are several trade and advocacy associations that represent the sector and engage with regulators on industry-wide matters. For example, The Blockchain Association of Canada is the principal national asso- ciation, bringing together infrastructure providers, exchanges, miners and service businesses. In addi- tion, the Canadian Web3 Council focuses on policy engagement and federal-level advocacy for Web3 businesses. Lastly, The Canadian Blockchain Con- sortium, based in Alberta, draws together industry, academia and government on technology adoption and standards. Although these bodies do not exercise regulatory authority, they contribute to consultations on securities, tax, AML/CTF and energy policy matters affecting the sector, and serve as recognised industry interlocutors during CSA, FINTRAC and Department of Finance policy processes. remedies where code is immutable. 1.1.5 Industry and Trade Bodies
Crypto-assets are treated as a form of property under Canadian law, though there is no comprehensive statutory framework that defines digital asset owner- ship. In the QuadrigaCX proceedings, which began in the Nova Scotia Supreme Court in February 2019 and were transferred to the Ontario Superior Court of Justice (Commercial List) in September 2019, the court held that the definition of property in the Bank- ruptcy and Insolvency Act is broad enough to include crypto-assets. Canadian courts have since applied this approach, including by granting Mareva injunc- tions to freeze crypto wallets in fraud matters and by treating digital tokens as divisible property in family law disputes. In practice, ownership of crypto-assets is generally tied to control of the private cryptograph- ic key associated with the relevant blockchain wallet address. Significant legal uncertainty remains, how- ever, particularly where assets are held through third- party custodians or on centralised platforms. Transfer of ownership is determined by the underlying block- chain protocol. A transaction is generally considered final once confirmed on-chain, though the legal rec- ognition of that transfer in the context of fraud, insol- vency or disputed transactions remains unsettled. On collateral arrangements, provincial personal property security statutes such as Ontario’s PPSA have not been specifically amended to address digital assets. Uncertainty persists around the creation, perfection and priority of security interests in crypto-asset collat- eral. The Uniform Law Conference of Canada has con- sidered potential reforms but no amendments have been enacted to date. The CSA addressed crypto- backed lending platforms in an October 2025 staff notice, emphasising that these activities may trigger securities registration requirements. 1.2.2 Access to Banking There are no formal statutory restrictions in Canada prohibiting chartered banks or other financial institu- tions from providing banking services to crypto-asset firms. In practice, however, crypto-asset businesses, whether registered as money services businesses with FINTRAC or as investment dealers with CIRO, fre- quently encounter significant difficulty obtaining and maintaining general banking relationships with Cana- da’s major chartered banks. Traditional banks tend to
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