OSFI will issue draft guidelines on public disclosures by fall 2024. Final guidelines will be communicated by winter 2025, taking effect in Q4 2025.

Deadline for comment on the consultation is 31 January 2024.

OFSI is proposing changes to its capital and liquidity approach to cryptoassets to "reflect an evolving risk environment and international developments."

Final versions of the guidelines will come into effect in fiscal Q1 2025. They will replace the interim advisory on the regulatory treatment of cryptoasset exposures published in August 2022. That advisory will be withdrawn on enactment of the new guidelines. 

The draft guidelines incorporate the Basel Committee on Banking Supervision (BCBS) standards for cryptoasset exposures released in December 2022. They have also been updated to reflect the Canadian context and the industry for which the guideline has been developed (i.e. banking or insurance).

OFSI said the new guidelines propose a simplified approach and a comprehensive option depending on the extent of an institution’s exposure to cryptoassets.

Both guidelines detail four classifications of cryptoassets and the capital treatment for each.

Deadline for comments is 20 September 2023.

The guidance provides an overview of public cryptoasset funds operating in Canada and describes related oversight initiatives by CSA members.

The notice also covers:

• Market characteristics of cryptoassets that could impact their viability as investments for public cryptoasset funds
• Expectations concerning custody of cryptoassets held on behalf of a fund
• Issues relating to yield-generating activities, like staking, by public cryptoasset funds
• Know-your-client, know-your product and suitability obligations with respect to public cryptoasset funds.

Regulated entities are expected to "understand the risks of any planned cryptoasset activities and ensure  these risks have been properly addressed. Regulated entities must also ensure any cryptoasset activities comply with existing federal financial laws including the Bank Act, Insurance Companies Act, Trust and Loan Companies Act, and Proceeds of Crime (Money Laundering) and Terrorist Financing Act, as well as any regulations or guidance issued by federal and provincial regulatory agencies."

This interim approach builds on the consultative letter OSFI provided in July 2021 and outlines OSFI’s expectation that any currently held cryptoassets are managed prudently as well as sets limits on their use by banks and insurers. It also provides further guidance on how to approach the capital and liquidity treatment of cryptoasset holdings.

The Bank will work with the MIT Media Lab’s Digital Currency Initiative team to explore how advanced technologies could affect the potential design of a CBDC, building on the DCI’s ongoing research into CBDC. This exploration will help inform the Bank of Canada’s research effort into CBDC.

The central banks were the Bank of Canada, the Bank of England, the Bank of Japan, the ECB, the Federal Reserve, the Swiss National Bank and the Riksbank.