Frozen Crypto Assets & Wallet Restrictions

How cryptoassets can be restrained in Canada

Canadian law offers several distinct routes by which cryptoassets may be frozen or restrained. In civil proceedings, courts can grant Mareva injunctions (freezing orders) and preservation orders under provincial rules of court. In criminal matters, restraint orders may be made under the Criminal Code, and several provinces have civil forfeiture legislation that can target property alleged to be proceeds or instruments of unlawful activity.

Each route has its own legal tests, procedures and courts — for example, the Court of King's Bench in Alberta, or the Federal Court in some federal matters. A freezing or restraint order is not a forfeiture order. Your lawyer should review the order, the legislation it relies on and all deadlines promptly.

Investigating authorities, regulators and platform restrictions

Investigations may involve the RCMP, municipal police, the Canada Revenue Agency or provincial securities regulators such as the Alberta Securities Commission or the Ontario Securities Commission, coordinated nationally through the Canadian Securities Administrators. Financial intelligence obligations sit with FINTRAC under the PCMLTFA. Exchanges may separately impose their own compliance restrictions. Regulatory oversight, sanctions measures and court orders are distinct regimes; a regulator's involvement does not mean the same restraint power applies.

We help organise the order, notices, platform correspondence and account records so your appointed lawyer can identify the applicable framework. We cannot compel an exchange or authority to release assets.

Civil, criminal and regulatory restrictions are different

A civil Mareva injunction restrains dealings with assets while a claim proceeds. A Criminal Code restraint order supports potential forfeiture following criminal proceedings. A provincial securities commission may issue freeze directions under securities legislation. An exchange's compliance hold is a private contractual measure, not a court order at all.

Identifying which of these applies — and in which province or territory — is an essential first step before any response can be considered.

Why cryptocurrency may become restricted

Restrictions can follow concerns raised by an exchange's compliance team, information shared between agencies, links identified through blockchain analysis, or wider investigations involving other parties. Sometimes the person affected has no direct connection to the activity under review.

Review the order and any deadlines

The wording of the order matters. It will usually state which assets are affected, how long the restriction lasts, and when any further hearing may take place. Note every date carefully and share the order with a qualified lawyer licensed in the relevant province or territory as soon as possible.

Wallet addresses, transaction IDs and exchange statements

Wallet addresses, transaction hashes and exchange account statements form the factual backbone of a crypto asset matter. Gathering them in one place, in date order, makes it far easier to explain how assets arrived in a wallet and where they came from.

Source of funds and source of wealth

Source-of-funds documents show where the money used for a particular transaction came from — for example, a bank transfer to an exchange. Source-of-wealth material shows how your overall assets were built up, such as salary, business income or the sale of property. Both are commonly important.

Ownership evidence and third-party interests

Where assets are held jointly, on behalf of a business, or belong in part to someone else, evidence of ownership becomes central. Third parties may have their own interest to protect and may need separate advice.

TxID reconciliation and an indexed evidence bundle

Transaction hashes (TxIDs) are cross-referenced to exchange deposits and withdrawals, bank transfers, dates, network fees and supporting records. Source-of-funds (SOF) and source-of-wealth (SOW) documents are kept distinct, with proof-of-ownership and third-party interests indexed separately.

The agreed output may include a document register, transaction schedule, factual chronology, ownership schedule and a record-gap list. We prepare an indexed evidence bundle ready for lawyer review; any court format, legal submission or application to vary or set aside an order remains the responsibility of your appointed legal counsel.

Cross-border matters

Cryptoasset matters frequently span borders. An order made in another country, or assets held by a foreign exchange, may require proceedings or recognition steps in more than one jurisdiction. We identify the jurisdictions involved so your lawyers can assess where action is needed.

Why prompt independent legal advice matters

Freezing and restraint orders carry legal consequences and time limits. DLO Associates is a consultancy, not a law firm. We support the preparation of material, but decisions about challenging, varying or responding to an order should be taken with a qualified lawyer.