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

Overview

The Office of the Superintendent of Financial Institutions (OSFI) is launching a 60-day public consultation on proposed updates to its Capital and Liquidity Treatment of Crypto-asset Exposures (Banking) Guideline.

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.

The proposed revisions are targeted in scope and aim to reflect how crypto‑asset markets have developed, while ensuring their capital and liquidity treatments remain appropriate. Specifically, OSFI is proposing to recognize cross‑exchange hedging for Group 2a crypto‑assets traded on regulated exchanges of traditional financial assets when calculating capital requirements.

No changes are being proposed at this time to the risk weight applied to Group 2a crypto‑assets or to their eligibility as collateral.

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 balance support for responsible innovation with its core mandate to protect depositors and policyholders and maintain confidence in Canada's financial system.

Recognizing cross‑exchange hedging for Group 2a crypto‑assets on regulated exchanges of traditional financial assets is important because:

• banks primarily use market‑neutral strategies when managing crypto‑asset exposures
• prices for the same crypto‑asset tend to move almost identically across major regulated exchanges
• only partially recognizing these hedges, as is currently allowed, can overstate risk, resulting in higher capital requirements than actual risk may warrant

When capital requirements more closely reflect actual risk, banks are less likely to be required to hold excess capital. This helps ensure capital remains available for banks to support lending and other economic activity, while preserving the safety and soundness of the financial system.

Next steps

The consultation is open until July 20, 2026. Stakeholders can submit comments to Consultations@osfi-bsif.gc.ca.

OSFI expects to publish the final guideline in September 2026. Implementation would take effect on:

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

OSFI will continue to monitor developments in crypto‑asset markets and assess whether further changes to the guideline are warranted as evidence and international standards evolve.