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Consultation Until Sep 20, 2023: OSFI Proposes New Guidelines for Crypto-Asset Exposures in Canada
OSFI Consultation | Jul 26, 2023
The Office of the Superintendent of Financial Institutions (OSFI) in Canada has announced proposed changes to its capital and liquidity approach for crypto-assets. This move is in response to the evolving risk environment and international developments in the crypto space. Consultation open until Sep 20, 2023.
OSFI has released two draft guidelines for public consultation, one for federally regulated deposit-taking institutions and another for insurers. These guidelines aim to provide clarity on the regulatory capital treatment of crypto-asset exposures. The guidelines are open for public consultation until September 20, 2023.
The proposed changes follow the new banking standards for crypto-asset exposures released by the Basel Committee on Banking Supervision in December 2022. The new guidelines from OSFI are expected to replace the interim advisory on the regulatory treatment of crypto-asset exposures, which was published in August 2022, and will come into effect in early 2025.
See: Canadian Regulators Set Expectations for Crypto Asset Investment Funds: A Comprehensive Overview
The new guidelines propose a simplified approach and a comprehensive approach, depending on the extent of an institution's exposure to crypto-assets. They detail four classifications of crypto-assets and the capital treatment for each. The banking guideline reflects the December 2022 BCBS banking standard, while the insurance guideline incorporates relevant parts of the BCBS standard with adjustments to meet the specific context of the insurance industry.
These guidelines will replace the interim advisory on the regulatory treatment of crypto-asset exposures, published in August 2022, when they come into effect in early 2025.
The two draft guidelines will be open for public consultation until September 20, 2023. Comments can be sent to consultations@osfi‑bsif.gc.ca.
Peter Routledge, Superintendent of Financial Institutions:
“Deposit-taking institutions and insurers need clarity on how to treat crypto-asset exposures when it comes to capital and liquidity. We look forward to giving them this clarity through these new guidelines that reflect industry input and international standards.”
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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