Backgrounder: Capital and Liquidity Treatment of Crypto-asset Exposures (Banking) – Guideline (2027)

Overview

The Office of the Superintendent of Financial Institutions (OSFI) has published its final Capital and Liquidity Treatment of Crypto-asset Exposures (Banking) Guideline for 2027.

The guideline sets out how banks must hold capital and manage liquidity when they have exposures to crypto‑assets. It is based on global standards developed by the Basel Committee on Banking Supervision and is informed by extensive consultation with stakeholders to reflect the Canadian context. OSFI will continue to monitor, contribute to, and help shape international standards and will update the guideline as evidence, market practices, and international standards evolve.

Following consultation with stakeholders, OSFI made two targeted changes:

• recognizing certain hedging arrangements across regulated exchanges when calculating capital requirements for Group 2a crypto-assets
• excluding derivative exposures arising from client-clearing activities from the Group 2 exposure limit calculation

Why it’s important

Crypto‑assets remain a fast‑moving, and relatively new asset class compared to traditional financial instruments. OSFI’s approach seeks to support responsible innovation and legitimate activity while prioritizing the protection of depositors and the resilience of Canada’s financial system. While financial resilience remains OSFI's primary objective, the framework also seeks to support prudent innovation and ensure banks can continue to meet client needs.

The changes recognize that:

• the same crypto-assets generally trade at very similar prices across major regulated exchanges
• banks can reduce risk by holding offsetting positions in the same crypto-asset on different exchanges
• client-clearing activities can involve limited residual risk after offsetting positions are taken into account

The final guideline builds on OSFI's existing approach, which already includes a more accommodating exposure limit than the current Basel calibration. OSFI is providing additional relief by excluding qualifying client-clearing activity from the limit.

These changes better align the capital treatment of certain crypto-asset activities with their underlying risks, while maintaining appropriate prudential safeguards. Canadian banks are not currently constrained from undertaking crypto‑asset activities under the existing framework. At the same time, OSFI is retaining capital requirements and prudential safeguards where the evidence does not justify their removal. The changes reflect stakeholder feedback and Canadian market circumstances, and are part of OSFI's ongoing efforts to modernize its framework as evidence, markets and international standards evolve

Next steps

The guideline will take effect on:

• November 1, 2026, for institutions with a fiscal year ending October 31
• January 1, 2027, for institutions with a fiscal year ending December 31

OSFI will continue to monitor developments in crypto-asset markets and consider whether further changes are warranted as evidence and international standards evolve.