According to the OSFI, a regulator, financial institutions in Canada would see a consultation period for their crypto holdings disclosure requirements.
Various crypto laws worldwide require regulated bodies in countries to disclose their crypto holdings. Canada may have similar crypto laws requiring regulated financial institutions to disclose their crypto exposure. Recently, a regulator in the country, the Office of the Superintendent of Financial Institutions (OSFI), has started a consultation.
According to an announcement by the OSFI, the consultation was formed along the lines of a Basel Committee consultative report. The report of October 2023 shares details on public crypto disclosure. The document specifies internally active banks would have to follow the rules by 2025.
The announcement by the Canadian regulator also has similar traits. It said, “Digital innovation is transforming how we transact, manage money, and view value but poses risks to our financial system. Recent crypto events underscore the risks of unregulated financial innovation. Public disclosures enhance transparency, comparability of data, and market discipline for a safer financial system.”
Moreover, the Superintendent of Financial Institutions, Peter Routledge, also claimed such disclosures of crypto-assets would help manage risk. He welcomed feedback that was according to the Canadian requirements.
The OSFI said the draft guidelines will release by fall 2024. Meanwhile, the final guidelines will be released in 2025, with effect by the fourth quarter of the year. Canadian pension funds have had exposure to crypto funds and had invested in crypto firms earlier. Some resulted in losses, which could have prompted the government to stricter rules.
On the other hand, Canadian lawmakers have previously supported the crypto industry. They prepared a report recommending a few measures to unlock the industry’s potential. The Canadian Securities Administrators also shared insights on crypto trading earlier this year.
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