Crypto Divides Canada's Political Landscape: The Dispute Between Liberals and Conservatives
Can the crypto market in Canada expect a positive change following the election results?
Cryptocurrencies have become a significant point of discord between Canada's Liberal and Conservative parties. In 2022, Conservatives fervently advocated for crypto as an escape from inflation, accusing the Liberal party of causing inflation to soar to 30-year highs through their economic policies, exacerbating the housing crisis.
On the other hand, Liberals deemed crypto too volatile and a reckless investment. With the federal government treating cryptocurrencies like securities, establishing a crypto-focused business in Canada remains challenging for innovators. This protective approach is seen by Conservatives as harmful to the country's economic and technological growth.
The Conservative Party's crypto champion, Pierre Poilievre, championed the use of cryptocurrencies alongside the Canadian dollar to combat high inflation. He dreams of reclassifying cryptocurrencies from securities to commodities to boost crypto adoption and make Canada the "blockchain capital of the world".
Michelle Rempel Garner's Cryptocurrency Initiative
The visionary MP Michelle Rempel Garner introduced Bill C-249 in 2022, aimed at opening communication between the Finance Minister and crypto developers/entrepreneurs, creating a legal framework for regulating cryptocurrencies. Rempel Garner pointed out that Canada loses talented individuals due to the lack of crypto support and restrictive legislation.
Despite being welcomed by Canadian innovators and the Conservative Party, Bill C-249 was defeated during its second reading in the House of Commons.
Coinbase's Warning on Crypto Regulation and Canada's Global Position
Coinbase's concerns regarding the lack of crypto reforms in Canada could potentially put the nation's global economic position at risk.
Trump and the 2021 Election
Trump's statements on turning Canada into the 51st U.S. state solidified the support of older voters for the Liberal Party. Prime Minister Mark Carney, seen as the political figure best suited to protect Canada's interests, focused on domestic issues such as inflation and housing costs. Young voters surprisingly flocked to the Conservative Party, while the older generation, concerned about dealing with Donald Trump, formed a substantial voting bloc, securing Carney's victory.
Other factors, such as the Green Party excluding candidates to avoid splitting the vote with the Liberals and weak Conservative support in Quebec, also played a part in Carney's victory.
In his victory speech on April 29, Carney mentioned, "We are over the shock of the American betrayal, but we should never forget the lessons." Trump, for his part, did not seem worried about Carney's victory and expressed optimism about their future relationship.
Stablecoins and Canada's Independence from U.S. Dollars
The Circle's decision to remove U.S. Treasury bonds from its stablecoin reserve in 2023 indicates a shift towards Canadian independence from USD-pegged stablecoins. As the Conservatives promotes stablecoins as a method to protect Canadian economic stability, the Liberal Party's stance can be seen as a step toward autonomy from the United States.
The Future of Canada's Cryptocurrency Sector under Carney
Mark Carney, now the re-elected Prime Minister, maintains a cautious and regulated stance on cryptocurrency. Criticizing Bitcoin as not a reliable store of value, Carney supports central bank digital currencies, citing their potential to improve financial systems and provide greater regulatory control.
As former head of both the Bank of Canada and Bank of England, Carney leans toward centralized financial institutions. He believes that central bank digital currencies are superior to stablecoins. It appears that the Liberal Party will maintain its critical view of cryptocurrency in the coming years, posing an uphill battle for crypto advocates in Canada.
- The Conservative Party, advocating for cryptocurrencies as a means to combat inflation, accuses the Liberal party of causing high inflation through their economic policies.
- Liberal politicians deem cryptocurrencies too volatile and a risky investment, taking a protective approach towards regulatory measures.
- Pierre Poilievre, a crypto champion in the Conservative Party, dreams of reclassifying cryptocurrencies from securities to commodities to increase adoption and position Canada as a world leader in blockchain technology.
- Michelle Rempel Garner, a visionary MP, introduced Bill C-249 in 2022, aiming to create a legal framework for regulating cryptocurrencies and fostering communication with crypto developers and entrepreneurs.
- Despite being welcomed by innovators and the Conservative Party, Bill C-249 was defeated during its second reading in the House of Commons.
- Coinbase's concerns over the lack of crypto reforms in Canada could potentially risk the nation's global economic position.
- Trump's statements on Canada becoming the 51st U.S. state solidified support for the Liberal Party among older voters, while young voters surprisingly flocked to the Conservative Party.
- The Circle's decision to remove U.S. Treasury bonds from its stablecoin reserve indicates a move towards Canadian independence from USD-pegged stablecoins, with the Conservatives promoting stablecoins as a protectant of economic stability.
- Mark Carney, the re-elected Prime Minister, maintains a cautious and regulated stance on cryptocurrencies, expressing support for central bank digital currencies over stablecoins and likely continuing the Liberal Party's critical view of cryptocurrency in the coming years.
