The Office of the Superintendent of Financial Institutions (OSFI), Canada's financial regulator, has proposed new rules related to the capital and liquidity requirements of cryptocurrencies held at banks and credit unions.
The regulator said the proposed changes are needed to address the risky environment in which digital coins and tokens trade, as well as more stringent international banking standards.
OSFI is proposing new guidelines for federally regulated deposit-taking institutions such as banks and credit unions in Canada, changing the capital treatment of their cryptocurrency assets.
The regulator said it is seeking to provide banks and credit unions with greater clarity on how they should treat cryptocurrencies when it comes to capital and liquidity requirements.
The draft guidelines are now open for public consultation until September 20. The new rules, once finalized this autumn, are expected to come into force in 2025.
The new guidelines will eventually replace the current advisory on the regulatory treatment of cryptocurrencies that was published by OSFI in August 2022.
This June, the regulator raised the amount of capital the country's banks must hold as a stability buffer by 50 basis points to 3.5%, citing rising borrowing costs and stress on Canada’s financial system.
It is not clear how much cryptocurrency Canada’s banks and credit unions currently hold.
