‘New, decentralized, bottom-up economy’: Pierre Poilievre wants to make Canada the ‘Blockchain capital of the world’

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Pierre Poilievre promises to “unleash” the potential of cryptocurrency like bitcoin and ethereum if he becomes prime minister, and make Canada the “the Blockchain capital of the world”.

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Speaking in London, Ont., Poilievre, who is campaigning to become the next federal Conservative leader, said he intended to simplify and streamline rules and taxes to make it easier for Canadians to decide to use cryptocurrency instead of traditional forms of money. He insisted on the importance of decentralizing the power of central banks.

“A Poilievre government would welcome this new, decentralized, bottom-up economy and allow people to take control of their money from bankers and politicians. It would expand choice and lower the costs of financial products, and create thousands of jobs for engineers, programmers, coders and other entrepreneurs,” read a press release from his announcement.

If elected prime minister, Poilievre would not only keep cryptocurrency legal in Canada, but would also work with provinces on a voluntary basis “to align rules and definitions across jurisdictions to make it easy for blockchain companies to operate across Canadian jurisdictions at the same time without a cobweb of contradictory rules”.

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His announcement on Monday was music to the ears of people in the industry who are hoping to see a national and more cohesive framework across all 10 provinces in Canada in order to attract investors and new talent.

“I think it’s very positive. I like the approach that he’s taking. I think that he highlights some of the issues that have occurred in Canada domestically, but also internationally in other jurisdictions,” said Eric Richmond, CEO of Tetra Trust Company, Canada’s first licensed digital asset custodian, in an interview with National Post.

“The fact that what is called blockchain and crypto has now moved up and is getting the kind of attention now from someone like Pierre to actually make change and craft legislation that fits this new economy, I think that’s very exciting.”

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Alberta has already announced its intention of becoming a Canadian cryptocurrency hub. But the different securities regulators in the provinces makes it difficult for businesses to flourish or attract new talent, stressed Brian Mosoff, CEO of Toronto-based Ether Capital.

“It’s been very cloudy, and it’s time for the country to figure out how we are going to coordinate across all the provinces’ frameworks so that these businesses can flourish here, otherwise, they’re just going to go into other jurisdictions and leave,” said Mosoff.

Poilievre, who was the finance critic for the Conservatives until recently, once again blamed the Bank of Canada for creating “$400 billion in cash out of thin air” since the start of the pandemic and suggested that alternative forms of payment could combat inflation.

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While in London, Poilievre used bitcoin to buy shawarma in a local restaurant, while touting on social media that the shop owner had “outsmarted” the federal government to “beat inflation”. He added in his press release that the “government is ruining the Canadian dollar, so Canadians should have the freedom to use other money”.

Geneviève Tellier, a professor at the University of Ottawa who specializes in budgetary policies and public finance, said that while Poilievre’s tone is very anti-establishment against the financial sector, he is not proposing a radical change to replace traditional currency.

“He’s not revolutionizing anything. He’s not abolishing the Bank of Canada. So there’s a difference between the message and his strong rhetoric against the establishment … and what we read with the fine print. He understands that cryptocurrency will not necessarily replace the Canadian dollar, contrary to what we understand when we read the headlines.”

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An industry source, who declined to be named in this story, proposed that the “biggest, fastest way” to create change would be to force big banks to start integrating cryptocurrency. Right now, crypto companies cannot open bank accounts at Canadian banks, forcing them to resort to credit unions. That is more expensive and ultimately stifles innovation, according to the source.

“They’re being treated like cannabis was five, 10 years ago. The banks have taken this position that anybody who’s in the business of any crypto-related business is too risky,” said the source.

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But Tellier added there could be a risk to Poilievre going too hard against the financial sector, which tends to be more conservative politically. She said he might be “shooting himself in the foot” if he targets them in his anti-establishment message.

Whatever the political stripe of the federal government, Mosoff said “the asset class is here to stay and going to grow”.

“Humanity is moving more and more towards globalization, interconnectivity, Internet-based disruption. You’ve seen Uber disrupt the taxi industry, Airbnb disrupt the hotel industry, and now you’re seeing blockchains and cryptocurrencies disrupt or challenge central bank digital currencies. There’s a big story that we’re really just scratching the surface,” he said.

“Bitcoin and ethereum are important assets, but there’s a lot of infrastructure still to be built. The question is: where in the world is that going to take place?”