Canada proposes new capital rules for crypto holdings

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The Office of the Superintendent of Financial Institutions (OSFI) is opening nationalist consultations connected 2 draught guidelines updating its superior and liquidity attack to crypto assets.

Canada proposes caller   superior  rules for crypto holdings

Canada's fiscal watchdog is proposing changes to its superior and liquidity attack to crypto assets, according to an announcement connected July 26. According to the Office of the Superintendent of Financial Institutions (OSFI), the projected rules volition simplify institutions' attack to perceived crypto risks, defining 4 categories of crypto assets and their superior treatment.

OSFI is opening nationalist consultations connected 2 draught guidelines until Sept. 20. One of the guidelines affects federally regulated deposit-taking institutions, specified arsenic banks and recognition unions, portion different line addresses the regulatory superior attraction of crypto-asset exposures for insurers.

“Deposit-taking institutions and insurers request clarity connected however to dainty crypto-asset exposures erstwhile it comes to superior and liquidity. We look guardant to giving them this clarity done these caller guidelines that bespeak manufacture input and planetary standards,” said OSFI superintendent Peter Routledge.

— Superintendent of Financial Institutions (@OSFICanada) July 26, 2023

The caller rules question to bespeak an "evolving hazard environment," notes the regulator. The rules besides code changes introduced by the Basel Committee successful December 2022 outlining caller banking standards for crypto assets exposures with implementation acceptable for Jan. 1, 2025. The Basel Committee's caller standards see rules related to tokenized accepted assets, stablecoins and unbacked crypto assets.

According to OSFI, its drafts incorporated the caller planetary banking standards, portion the security guidelines are adjusted to conscionable the circumstantial needs of the section security industry.

The caller guidelines volition also replace an existing advisory published successful August 2022 that defined and categorized crypto-asset vulnerability and its imaginable risks for fiscal institutions.

Canada's evolving regulatory scenery comes amid increasing concerns astir the ramifications of integer assets connected banking systems worldwide. In the United States, crypto-friendly banks specified arsenic Silvergate and Signature Bank unopen down operations amid liquidity issues stemming from crypto-related events successful 2022.

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