Canada is set to launch a new cryptocurrency fund with the aim of helping entrepreneurs get their first venture capital investment in the digital currency space.
The $10 million fund, called the Freedom Fund, will be launched later this month, said Marc Garneau, the minister of finance.
The fund will be managed by the Canadian Securities Administrators, or CSAs, and will be a separate entity from the Canadian Venture Capital Association.
The two entities are currently separate entities and will merge once the fund is launched, Garneau said at a media briefing.
The CSAs would handle the investment, but it will be handled by the Freedom fund, which will be the fund’s primary investor.
In order to be eligible for the fund, companies must meet certain requirements.
It will have to be established by a company that has not had its first venture-capital investment in cryptocurrency since 2014, Garnecont said.
The Freedom Fund will offer both equity and debt securities.
It also plans to provide an annual performance report.
Garneau would not discuss the amount of money the fund would be seeking but said the fund will not be backed by the government.
The government will not receive any of the funds raised through the fund and would not participate in the decisions made by the fund.
The announcement comes as Canada prepares to roll out its own version of a Bitcoin ETF, a measure that could be a key test for the cryptocurrency’s wider acceptance in the country.
The Canadian government is set for a crucial decision at the end of the month when it will unveil a plan for an international Bitcoin ETF.
The Securities Act allows the minister to set up a fund to cover the risk of a currency that becomes too volatile, or one that is not secure from theft.
This fund will likely be funded by the CFIA, which already has some of the largest crypto assets under management in the world.
However, the government has not set a date to decide on the fund yet.
While Canada has a long history of using the currency for legitimate purposes, the currency has been seen as volatile in recent months, and has been linked to recent terrorist attacks.
Canada’s Finance Minister Bill Morneau has also been outspoken in his support of cryptocurrency, stating at a Bitcoin forum in February that he believes cryptocurrencies can be a tool to solve some of Canada’s financial problems.
“I think cryptocurrencies are a tool for financial innovation, and I think that the Canadian government should be looking at that,” Morneau said.
“And I think we need to be thinking about it.
But I don’t think that Bitcoin should be a currency of choice for Canada, it should be the currency of the future.”
(Read more: Bitcoin is growing in popularity, but a lot of people are still unsure about how it works and what it means)