Canada updates banking framework for crypto and tokenised deposits

The regulatory shift comes as banks explore new ways to integrate digital assets and blockchain infrastructure into conventional financial services.

Canada’s banking regulator is taking a more accommodating approach to tokenised deposits and selected crypto-asset activities, while maintaining prudential safeguards for financial institutions. The Office of the Superintendent of Financial Institutions (OSFI) has clarified that tokenised deposits are ‘not legally distinct’ from traditional deposits, meaning their underlying technology does not determine their legal treatment.

The regulator nevertheless expects financial institutions to ensure that tokenised products comply with applicable laws and regulations, including where activities are carried out by third parties. Banks are also expected to engage with their OSFI supervisors before launching novel products or services, allowing institutions to assess the regulatory implications of tokenised deposit initiatives.

OSFI has published its final Capital and Liquidity Treatment of Crypto-asset Exposures (Banking) Guideline for 2027, introducing targeted changes to the capital treatment of crypto-asset activities. The updated framework recognises certain hedging arrangements across regulated exchanges and excludes qualifying derivative exposures arising from client-clearing activities from the Group 2 exposure limit calculation.