Canadian Regulators Confirm Legal Status of Tokenized Deposits is the Same as Traditional Deposits

The Office of the Superintendent of Financial Institutions (OSFI) in Canada has stated that tokenized deposits are legally indistinguishable from traditional deposits, and the underlying technology does not affect their legal nature. OSFI noted that financial institutions can conduct tokenized deposit business under existing financial regulatory laws without the need for additional regulatory provisions. Financial institutions and their third parties must ensure that their operations comply with applicable laws and regulations. OSFI requires financial institutions to communicate with regulatory authorities in advance before launching new products or services and recommends seeking legal advice prior to going live. The agency oversees nearly 350 financial institutions and 1,200 pension plans.

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