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Canada consults on bank crypto disclosures

canada basel crypto rules

Canada’s Office of the Superintendent of Financial Institutions (OSFI) is consulting on bank disclosures of crypto-assets. It follows a Basel Committee (BCBS) consultation on the same topic launched in October. Crypto-assets include tokenized securitiesstablecoins as well as cryptocurrencies.

Last year the Basel Committee issued rules governing bank capital requirements for engaging with crypto. The disclosure requirements are separate and cover how banks report their crypto activities. They have to report twice a year and the Basel Committee provided a series of templates. 

Tokenized securities and stablecoins are considered lower risk, provided they meet Basel’s requirements. So quite a bit of the reporting is around why a bank classified securities as low risk.

OSFI didn’t issue its own document, it simply cross referenced the Basel one and outlined three questions:

  • What, if any, technical aspects of the BCBS disclosure tables and templates should be amended for banks and insurers in the Canadian context?
  • What key considerations should we factor in to ensure proportionality of disclosures?
  • What other considerations raised by the BCBS consultation should we keep in mind in developing Canadian disclosure expectations?

Meanwhile, Canada ran a consultation on the capital rules earlier this year. As previously noted, Canada’s proposals are stricter than the Basel rules. It wants to apply a 2.5% risk weighting across all assets, including lower risk ones such as tokenized securities and stablecoins.

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