Canada’s OSFI says tokenized deposits are legally equivalent to traditional deposits

Canada’s Office of the Superintendent of Financial Institutions (OSFI) said on Sept. 10 that digital forms of deposits, including tokenized deposits, are not legally different from traditional deposits. OSFI said the legal nature of a financial product or service is determined by the nature of the product itself, not by the technology used to implement it, and added that existing laws and regulations for financial institutions apply equally to tokenized deposits. According to the regulator, financial institutions must consult with their OSFI supervisory contact before launching new products and must also comply with guidance on technology, cyber, and third-party risk management.