Canadian Regulator Flags Kraken, Coinbase CEO Tweets to Law Enforcement

The Ontario Securities Commission (OSC) has contacted the Royal Canadian Mounted Police (RCMP) about tweets published by the CEOs of crypto exchanges Coinbase and Kraken regarding the ongoing ‘Freedom Convoy’ protests in Ottawa. 

"We are aware of this information and have shared it with the RCMP and relevant federal authorities," Kristen Rose, the OSC’s manager of public affairs, told Canadian news outlet the Regina Leader-Post. 

The tweets, published by Coinbase CEO Brian Armstrong and Kraken CEO Jesse Powell, appeared to criticize the Canadian government’s invocation of the Emergencies Act as part of the response to Ottawa’s convoy protests. 

Armstrong tweeted that "self-custodial wallets are important," adding that it was concerning that—under the Emergencies Act—banks can freeze or suspend bank accounts without a court order. Self-custodial wallets are controlled by an individual rather than a third party, effectively making it impossible for law enforcement to freeze the funds held on them. 

In turn, Powell’s tweet advised people not to fund causes "directly from custodial wallets," adding that individuals should "withdraw to non-custodial" wallets before sending funds. 

Powell previously donated to the convoy protests, sending one Bitcoin to HonkHonkHodl, a crypto fundraiser in support of the protests against Canada’s COVID-19 vaccine policy. He also warned that Kraken would be "forced to comply" with law enforcement, urging users to remove their holdings from the exchange if they are concerned.

Canada’s ‘Freedom Convoy’ protests and crypto

The OSC’s decision follows a ruling issued by an Ontario Superior Court judge last week, which ordered the freezing of millions of dollars—including some crypto—amid Ottawa’s convoy protests. 

The Mareva injunction–the first of its kind targeting Bitcoin and other cryptocurrencies—restrained protestors from "selling, removing, dissipating, alienating or transferring" any of the assets raised in relation to the convoy protests. 

The order also targeted entities that have held assets for the convoy protestors themselves. These include prominent Canadian banks like TD Canada and ATB Financial, as well as approximately 150 cryptocurrency wallets.

The entities and individuals targeted by this injunction are now compelled to provide a “sworn statement” that describes the nature, value and location of their assets. Should they refuse to comply, the government may find them to be in contempt of court.