The Ontario Securities Commission (OSC), on behalf of the Canadian Securities Administrators (CSA), recently granted ZED Network Inc. (Company) discretionary \exemptive relief from prospectus and dealer registration requirements under Canadian securities laws for the distribution of the ZED digital remittance and foreign exchange blockchain token.
This prospectus exemption is the first granted under the CSA Regulatory Sandbox for a primary distribution of digital cryptocurrency tokens on a blockchain. To obtain the relief, the Company applied to the OSC LaunchPad as part of the CSA’s Regulatory Sandbox initiative. The relief provides regulatory certainty for the Company and users of the ZED Network for the use of ZED tokens in Canada, providing specific and clear prospectus and registration exemptions on prescribed conditions.
The CSA Sandbox has granted only two previous exemptions involving distributions of tokens, in 2017, and both relied upon the statutory offering memorandum prospectus exemption. The ZED tokens may be distributed in Canada and resold either under the normal accredited investor exemption or under this new customized exemption for money services businesses.