{"id":8711,"date":"2022-02-24T19:22:45","date_gmt":"2022-02-24T19:22:45","guid":{"rendered":"https:\/\/nftandcrypto-news.com\/nft\/canada-tests-new-measures-on-freezing-crypto-funds-updated\/"},"modified":"2022-02-24T19:22:47","modified_gmt":"2022-02-24T19:22:47","slug":"canada-tests-new-measures-on-freezing-crypto-funds-updated","status":"publish","type":"post","link":"https:\/\/nftandcrypto-news.com\/nft\/canada-tests-new-measures-on-freezing-crypto-funds-updated\/","title":{"rendered":"Canada Tests New Measures on Freezing Crypto Funds (UPDATED)"},"content":{"rendered":"
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Source: AdobeStock \/ JuliaDorian<\/figcaption><\/figure>\n

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The Canadian government is going ahead with its controversial moves to end the \u201ctruckers\u2019 protest\u201d over COVID-19 restrictions, which has brought much of the nation to a standstill \u2013 by freezing crypto-related bank accounts in an effort to cut off protesters\u2019 access to their own funds. Meanwhile, an injunction was signed that forbids moving funds in a number of crypto addresses. (Updated at 16:07 UTC: updates throughout the text.)<\/i><\/p>\n

The funds in over 120 addresses connected to bitcoin (BTC), ethereum (ETH), cardano (ADA), litecoin (LTC), ethereum classic (ETC), and monero (XMR) were frozen following a private class-action lawsuit against the protesters.<\/p>\n

The suit was filed by Zexi Li, Happy Goat Coffee Inc.<\/strong>, and Geoffrey Devaney, while among the defendants are listed Patrick King, Tamara Lich, Chris Garrah, Benjamin Dichter, and Nicholas St. Louis.<\/p>\n

The justice signed the injunction on Thursday, February 17. It is a so-called Mareva injunction, otherwise known as a freezing or asset protection order.<\/p>\n

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The court orders that the defendants, or anybody associated with them, cannot \u201cby any means whatsoever\u201d sell, remove, dissipate, alienate, transfer, assign, encumber, or similarly deal with the assets listed in the document.<\/p>\n<\/blockquote>\n

The Toronto Star reported that these accounts may be holding more than USD 1m in total, while some estimate<\/a> it may be more.<\/p>\n

According<\/a> to Ottawa lawyer Paul Chimp, this move was \u201cexceptional advocacy,\u201d and the frozen crypto funds may be used as compensation in the future.<\/p>\n

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Amir Attaran, a professor in the Faculty of Law<\/strong> and the School of Epidemiology<\/strong> at the University of Ottawa<\/strong>, commented<\/a> that \u201cthis Mareva unfolded secretly over the last several days in court.\u201d<\/p>\n

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Meanwhile, Alex Gladstein, Chief Strategy Officer at the Human Rights Foundation<\/strong>, argued that the injunction does not \u201cprevent\u201d those involved from selling, transferring, or dissipating funds, but instead \u201cthreatens them.\u201d \u201cKey distinction. In legacy finance the powers that be could prevent them,\u201d he wrote<\/a>. He further argued that crypto users can be imprisoned and released without ever giving up their cryptoassets.<\/p>\n

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Mareva injunctions are violative of basic due process. But these types of “nuclear weapons of the law” will be used with increasing frequency against cryptocurrency holders, as a way to compensate for the lack of financial intermediaries to lean on. https:\/\/t.co\/AXkxb9bAmW<\/p>\n

\u2014 W. Aaron Daniel (@wadaniel) February 18, 2022<\/a><\/p><\/blockquote><\/div>\n

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Freezing bank accounts\u00a0<\/h2>\n

Meanwhile, new police and government powers have been ushered in hurriedly as an amendment to the Emergencies Act, which effectively seeks to classify the protesters as terrorists, allowing banks and other bodies to freeze conventional bank accounts, including those related to crypto.<\/p>\n

Notably, while accounts on centralized crypto exchanges can also be frozen for a variety of reasons, it’s not the case with crypto wallets, controlled by their users.<\/p>\n

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The Canadian government finds that domestic and overseas supporters of the protests are attempting to fund the blockade operators using donations made in crypto.<\/p>\n

The Deputy Prime Minister and Finance Minister Chrystia Freeland stated:<\/p>\n

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\u201cThe names of both individuals and entities as well as crypto wallets have been shared by the Royal Canadian Mounted Police<\/strong> with financial institutions, and accounts have been frozen. And more accounts will be frozen.\u201d<\/p>\n<\/blockquote>\n

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In an opinion piece for the Toronto Sun, Freeland was quoted as stating further that \u201cthe consequences\u201d of the move were \u201creal and they will bite.\u201d<\/p>\n

But, the report continued,\u00a0<\/p>\n

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\u201cWhile Freeland made it sound as if only truckers with big rigs would be targeted, the rules stipulate the bank freezes can apply to anyone \u2018directly or indirectly\u2019 involved in the protests.\u201d<\/p>\n<\/blockquote>\n

And in the same media outlet, a leading conservative tabloid, the same columnist claimed that the \u201cincredible powers that Prime Minister Justin Trudeau has given his government to freeze people\u2019s bank accounts\u201d had been justified using \u201c\u2018analysis\u2019 from the CBC<\/strong>\u201d (Canada\u2019s biggest broadcaster).<\/p>\n

The columnist added:<\/p>\n

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\u201cThe basis for some of the most controversial measures they\u2019ve brought in merely rely on nothing more than CBC reporting.\u201d<\/p>\n<\/blockquote>\n

Law enforcement agencies even went so far as to warn pet-owning protestors that they might never see their animals again if they were arrested \u2013 drawing a biting response from El Salvador\u2019s BTC-keen President Nayib Bukele.<\/p>\n

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Some have pledged to fight the measures, including the Canadian Civil Liberties Association<\/strong> (CCLA), which claimed in an official release that it would seek to block the government from using the Emergencies Act.<\/p>\n

The CCLA\u2019s Executive Director, Noa Mendelsohn Aviv, was quoted as stating that it had employed a lawyer to \u201ctake the federal government to court,\u201d adding: \u201cWe have said all along that the federal government did not meet the high burden necessary to invoke the Emergencies Act.\u201d<\/p>\n

She stated:<\/p>\n

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\u201cThis morning I listened carefully to the Prime Minister and heard no new legal justifications for a national emergency and the enormous power the government is hoping to give to itself to bypass the typical democratic process. […] This use of the Emergencies Act is unnecessary, unjustifiable and unconstitutional.\u201d<\/p>\n<\/blockquote>\n

Some have claimed that the government has been forced to take extreme measures to put an end to protests after roads all over the country were blocked, bringing trade and transport to a halt.<\/p>\n

But others claimed that the moves sent a dangerous precedent about the fact that governments ultimately retain the power to cut off the finances \u2013 be they fiat or crypto \u2013 of their own people whenever they see fit.<\/p>\n

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In a Twitter post that now appears to have been deleted (but was reported on by the Daily Beast), Tesla<\/strong>\u2019s Elon Musk jokingly compared Trudeau\u2019s behavior to Adolf Hitler\u2019s. The media outlet called Musk\u2019s tweet \u201clazy, offensive and attention-seeking.\u201d<\/p>\n

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<\/strong>
– Canada Asks Banks, Exchanges to Block Crypto Accounts Tied to Trucker Convoy Protests
– Canada Joins Lebanon and Turkey in ‘Bitcoin’s Marketing Team’<\/p>\n

– Canadian Trucker Protesters Eye Bitcoin Amid Court-Ordered Fund Freeze
– Bitcoin Is More \u2018Public\u2019 Money than Central Bank-Issued Fiat Currencies<\/p>\n

– Canadian Tax Agency Launches Audit To Thwart Crypto Tax Evasion
– How Global Economy Might Affect Bitcoin, Ethereum, and Crypto in 2022<\/p>\n<\/p><\/div>\n