The latest company to register on the TSXV as of
February 1 was CryptoGlobal
a blockchain and fintech company mining bitcoin, dash, ether and litecoin.
Then there is Hut 8 Mining, a
company, based in Vancouver, that is a reverse takeover (RTO) vehicle for Bitfury.
The rig manufacturer and mining company has expressed its wish to rebalance the
Bitcoin network’s mining activity away from China.
Hut 8, which raised $38 million last December in
a private placement, is acquiring Bitfury’s North American operations. Hut 8
signed a letter of intent with Oriana, a capital pool
company that will amalgamate with it under the name Hut 8. This will be a
qualifying transaction that lists Hut 8 on the TSXV. Executives originally
planned to list on the TSXV in January, but this hadn’t happened as of early
February. Media spokespeople for the company were unable to comment.
The TSXV is no stranger to public listings from
companies in the blockchain space. In December, HashChain Technology went
public on the exchange with its proposal for a 26,500-rig Dash and Ethereum
mining operation. It joins HIVE Blockchain Technologies,
a company that emerged from natural resources exploration firm Leeta Gold.
Other blockchain companies on the TSXV include BTL Group, formed
after Northern Aspect Resources acquired Isle of Man–based Blockchain Tech Ltd.
and its Vancouver-based incubator in 2015.
Blockchain investment fund Global Blockchain
Technologies Corp. was delisted from the exchange on January 20.
Adam Button, chief currency analyst at currency
trading data firm ForexLive,
said that the TSXV is a common destination for companies following fashionable
is where all manias go,” he said. “It was marijuana this year, and next year
it’ll be anything related to bitcoin.”
Kyle Kemper, executive director of the Blockchain Association of Canada,
said that Canada has been a welcoming environment for cryptocurrency miners. He
drew a direct line between the flurry of TSXV activity and China’s reported
decision to discourage
crypto-mining operations within its borders.
“Where some countries are discouraging bitcoin
mining, Canada is actively attracting investment and we’re seeing it on the
public markets,” Kemper said.
While blockchain firms tap the TSXV for
traditional capital, the ICO markets could be a dark spot, warned Kemper.
In August 2017, the Canadian Securities Administrators
(or CSA, the collection of provincial regulators) issued a staff
notice on ICOs. A staff notice is a non-legally
binding guidance document outlining the various provincial regulators’ likely
approach. The notice said they would view each token sale on its own merits but
added that they see ICOs as securities offerings aimed at retail investors.
That would make it difficult to sell such tokens on exchanges.
There are some caveats, though. The CSA operates
a “sandbox” designed to encourage fintech innovation, which lets eligible
companies operate only under the regulation of their own province. This enabled
Quebec’s impak Coin
to operate as a regulated token in Canada.
Kemper remains unimpressed with the level of
regulation in Canada.
“If the process to launch a project in Canada is
too difficult, innovators will simply register elsewhere because their time is
valuable and complying with onerous regulations, where they may or may not get
approval, simply doesn’t make sense,” he said. “Regulators and policy makers
need to understand that as we enter an AI-like society, companies and projects
will domicile where the conditions are most favorable.”
All of which suggests that Canada is becoming
the best and worst place to create a blockchain-related startup, depending on
your business model.