Regulation | August 23, 2024
Image: Freepik/Drazen Zigic
OSFI Introduces Draft Amendments to Crypto Asset Exposure Disclosure to Ensure Financial Institutions Transparency and Systemic Stability
On August 22, 2024, the Office of the Superintendent of Financial Institutions (OSFI) published new recommendations for financial institutions’ disclosure of their exposure to crypto assets. This guidance is the result of a consultation held in 2023 that sought comments on materiality, proportionality, and liquidity disclosures for federally regulated financial institutions (FRFIs).
see: OSFI’s New Security and Integrity Guidelines 2024
These additional revisions were developed in response to feedback indicating the need for more consistent reporting and defined thresholds. These changes are intended to address the needs of small and medium-sized deposit-taking institutions (SMSBs), such as banks, insurance providers and credit unions. Complies with the global requirements of the Basel Committee.
Areas of consultation until October 2024
OSFI seeks feedback on four key areas or questions:
- Should exposure to crypto assets be disclosed using quantitative thresholds or should the materiality principle be used?
- Does it make sense to report end-of-period figures and daily average cryptocurrency exposure together?
- What level of detail is appropriate for liquidity disclosures for crypto assets, and how relevant is it?
- What is the best way to ensure proportionality in the disclosure obligations of small and medium-sized deposit-taking banks (SMSBs)?
see: CSA Updates on Value-Referenced Crypto Asset Regulation
that A new standard is expected to be adopted in 2026.and The consultation period runs until October 2024.. These changes are intended to improve openness, encourage market discipline, and ensure that financial institutions wisely manage the risks associated with crypto assets.
field of vision
The final regulations are expected to be introduced in 2025 and implemented in the first quarter of 2026.
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