Canada Issues New Bank Capital Regulations for Crypto Holdings

Canadian authorities published capital measures for banks and insurers that hold crypto assets on Wednesday, with a consultation period ending on September 20.
The Office of the Superintendent of banking Institutions stated that it was based its ideas on those proposed by the Basel Committee on Banking Supervision in December, which might determine how far the traditional banking sector embraces blockchain technology.
“Deposit-taking institutions and insurers need clarity on how to treat crypto-asset exposures when it comes to capital and liquidity,” said Peter Routledge, Superintendent of Financial Institutions, in a statement. “We look forward to giving them this clarity through these new guidelines that reflect industry input and international standards.”
The plans provide banks the option of using a more complete methodology that separates crypto depending on perceived risk, or a simpler but less discriminating one.
In December, international standard-setters suggested classifying unbacked crypto as the riskiest type of asset for banks to keep, with lenders limited in how much bitcoin (BTC) or ether (ETH) they can retain. Jurisdictions such as the European Union have already taken steps to legislate these changes.