In an online post, Wealthsimple lawyers Blair Wiley and Catherine De Giusti say securities regulators should update or replace Canada’s 2017 ban on binary options, or contracts where investors bet on the performance of an underlying asset within a period of time. (The Logic)

Talking point: Wiley and De Giusti argue the binary options ban, which was designed to protect Canadians from fraudulent offshore platforms, is a poor fit for regulating modern prediction markets. They propose eliminating a rule that platforms must list contracts for at least 30 days before they become due, which they say is ineffective at fighting fraud and discouraging speculative trading. Prediction markets generate new markets on a rolling basis—replacing, for example, a contract asking “Will the July unemployment rate be under 6.5 per cent?” with “August” the following month—making it unclear how the 30-day rule applies. Wealthsimple recently launched a prediction markets app that offers nearly 4,000 event contracts on U.S. predictions exchange Kalshi. 

Sponsored Content

The real-world economic offshoots of sovereign AI

By Deborah Aarts

Increasing healthcare access across Canada

By Deborah Aarts

What it takes to lead a frontier firm

By Deborah Aarts

Paid promotional content