Canada’s banking regulator, the Office of Superintendent of Financial Institutions (OSFI) has introduced rules for banks to manage their exposure in cryptocurrency as interest in digital assets continues to grow in the country.
The OSFI announced the final guidelines in the regulator’s quarterly report on Thursday, on cryptocurrency assets, together with consultation on capital requirements amid a major shift in the regulatory approach in the US where requirements are expected to ease. The initiative marks a significant step in digital assets and financial stability.
According to the Globe and Mail, the OSFI has been reviewing how Canada’s banks manage risks associated with crypto-assets. These include platforms and currencies such as Bitcoin – in their client portfolios. According to the regulation, banks should consider crypto that sits directly on their balance sheets, as well as asset exposures among their customers, at a time adoption of digital assets is improving.
The Globe and Mail has reported that Canadians who own Bitcoin jumped to 13% in 2021 from 5% in 2018, largely among men, as per figures released by the Bank of Canada in December.
While the OSFI is of the view that the current risk is relatively low, activity is picking up quickly, which calls for more oversight, according to Assistant Superintendent and Chief Strategy and Risk Officer Angie Radiskovic.
“We’re in a market where crypto is starting to pick up dramatically,” Ms. Radiskovic said during a conference call with reporters.
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