Over the last two weeks, I've published what Gemini tells me is the equivalent length of a Master's thesis (24000+ words) on the topic of launching tokens in Canada. My goal with this series is to challenge the orthodox view that launching a token in Canada is illegal. For years, lawyers have advised their clients to steer clear of Canada. But is that advice well-founded? What's the real state of the law? Has anything changed over the last decade? My thesis is that lawyers and regulators alike have failed to properly understand the nature of tokens, the developments since the 2017/2018 boom, and changing thought south of the border (see part 1). It's up to entrepreneurs to decide if Canada will be the home of the next great thing in crypto but I believe there's no legal barrier to the majority of projects launching here.

These posts capture my experiences working with some of the best lawyers in North America, and seeing how the cases, regulatory decisions, and projects have unfolded.

Tokens That Can Be Launched

People want to know what tokens can be launched. Part 9 of this series provides a simple guide to 14 token types: Native units, Standard tokens, Free tokens, Meme coins, image NFTs, fan tokens, loyalty tokens, wrapped tokens, Liquid Staking Tokens, Fee Protocol Tokens, Canadian dollar stablecoins, store credit tokens, debt tokens, and governance tokens. Even better: this post explain the logic for each type.

Selling Tokens

How can projects sell tokens? What methods are higher or lower risk? Part 10 summarizes the law on the tricky subject of presales, primary vs. secondary sales, and what shouldn't be done if a project wants to have a long-term future.

For most token-focused projects, part 10 will be the most immportant post to read in the series.

Token Innovation In 2026 And Beyond

This blog post series is the most comprehensive write up of Canadian law about tokens, and especially so for the modern era of tokens. This isn't 2017 anymore. And with the release of the mid-March guidance by the SEC/CFTC, this isn't even February anymore. There's a new world of digital assets that is opening up, and it goes far beyond price speculation or pump.fun meme coins.

Serious Canadian projects are going to appear that bake tokens into their systems. People will develop new decentralized business machines that make money for token holders, without any involvement of management. The Internet opens up information flows and stablecoins open up payment flows. Token innovation is just beginning.

Is This True?

Parts 9 and 10 are what most people want to read. Read the above links if you want to know quickly what the risks are, and then focus on what matters. I hope that people will bring these points to their lawyers, ask ChatGPT/Gemini/Claude, or at least discuss it with their cofounders. Risk management is best done with eyes wide open. And, in the best case scenario, the risk is actually far less than expected, or even zero.

But is my view correct? This blog post series starts at the beginning, not the end, to explain why today's understanding depends on a century of legal developments. For anyone who wants to understand the rationale for the above two posts, they'll need to read from the beginning, starting with the statutes, regulators, and historical developments.

Regulators: Federal & Provincial

The Bank of Canada, FINTRAC, and provincial securities regulators are the major actors in Canada to pay attention to. Part 2 looks at the federal regulators.

Part 3 looks at the history of securities regulation in Canada and how it draws on the American legal tradition. Part 4 is a detailed examination of the role of provincial securities regulators, their historical enforcement actions, and what they've said about crypto. This is then summarized in part 5 as being largely about raising capital. A nuanced look at the OSC as a particular example shows that their views have been misunderstood.

Tokens As Securities Or Not

People have not properly understood what sort of tokens are problematic in Canada, so part 6 attempts to summarize this, drawing on the previous posts about securities law. Jumping over to the US, part 7 analyses the mid-March SEC/CFTC guidance that is widely seen as a major change in the views of American regulators. This follows last year's end to enforcement proceedings against many US crypto projects.

There's no reason to think the same logic won't apply in Canada.

Ignore Howey: An Easier Explanation Of Investment Contract

Part 8 suggests that too many people have tried to apply the Howey Test without deeply understanding what it's about. The law of tokens is not merely a few words, and tech people have misunderstood what a legal test is. It's far better to view the rule as a different formulation: No ROI From Management (NRFM). Part 8 explains why NRFM is the best way to understand both Pacific Coin (the leading Canadian Supreme Court case) and subsequent developments since the 1970s.

Global Competition Of Jurisdictions: Cayman/BVI

I've helped many Canadians (and others) set up Cayman/BVI structures that have operated well and not one of them has faced regulatory action or lawsuits about their token sales. But is that because they were offshore? Typically the answer is no. The best way to run a token project is to consider global legal compatibility anyway. Yes, there may be tax advantages to being offshore, but even that is often overstated when considered in context. There's more to jurisdiction than just tax.

Whether or not offshore is the right path, Canadians should strongly consider whether they need to do it. Offshore structures are often expensive, complex, and may be uninvestable. Founders should always consider their home jurisdiction first, before rejecting that in favour of abroad.

Is This The Final Word On Tokens In Canada?

No. This blog post series explains why the door is open, but it remains to be seen what projects will launch. Technological developments are uncertain, and digital assets are still in their infancy.

There's been a lot learned over the last decade, and a lot of hard lessons for industry participants, but all of that has paved the way for a general acceptance of the ideas of crypto. Crypto wallets aren't an alien concept. Stablecoins are being used. Crypto ETFs exist on traditional stock markets. Great inroads have been made, and all of this opens up the opportunities for the next phase of development.

Hopefully this series helps people to understand the true nature of Canadian laws with respect to crypto projects. I've been an advocate of crypto for 12 years now, and it feels like finally the pieces are coming together. The Canadian landscape is much better than most people recognize, whether for technical developers or large companies that figure out how blockchains can add value.

I believe that next phase is domestic projects, whether Canadian, American, European, etc. I believe that next phase is professional, long-term, and legally sound. I believe it's possible for that next phase to begin right now.