Canada’s federal banking watchdog has given financial institutions clearer room to experiment with deposits recorded on digital ledgers. On September 10, 2026, the Office of the Superintendent of Financial Institutions published a short statement confirming that a deposit does not become a new legal product merely because it is represented as a token or transferred through distributed-ledger technology.
OSFI framed the announcement as support for innovation and competition, provided the financial system stays strong and resilient.
The regulator noted that banks and other federally regulated firms, along with their vendors, have already begun designing digitally represented deposits.
Officials said that particular use case needed extra clarity on whether such products fall within existing powers under federal financial-institution statutes.
The core message is technology-neutral.
OSFI looks at the economic and legal substance of a product, not the rails used to issue or move it.
In that view, tokenized deposits are not a separate class of liability from ordinary bank deposits.
A customer’s claim remains a claim on the issuing institution.
The method of bookkeeping or settlement does not, by itself, rewrite the nature of that claim.
That legal stance does not amount to a blanket approval or a new license.
Institutions remain fully responsible for making sure any innovative activity, including work done by third parties, complies with the law and with OSFI guidance.
The statement specifically points banks toward Guideline B-13 on technology and cyber risk and Guideline B-10 on third-party risk management.
Supervisors also expect firms to speak with their OSFI lead supervisor before launching various products and to obtain legal advice where needed.
The same day, OSFI finalized its 2027 capital and liquidity guideline for crypto-asset exposures.
Qualifying tokenized versions of traditional assets, including deposits that preserve the same legal rights and risk profile as conventional deposits, generally fall into Group 1a.
That grouping typically receives the same credit-risk treatment as the underlying non-tokenized asset.
The arrangement follows the direction set by the Basel Committee: tokenization that does not change cash-flow rights or credit exposure should not automatically trigger a harsher capital regime.
Conditions still apply.
A qualifying deposit token must remain a legally enforceable claim on the bank, redeemable at par in fiat currency, and tied to the issuer’s own creditworthiness rather than a separate reserve pool.
OSFI retains the ability to apply more conservative liquidity treatment if wallet arrangements, ledger infrastructure, or redemption mechanics introduce extra risk.
The framework also keeps tokenized bank deposits distinct from stablecoins that rely on external assets.For Canada’s banks, the combined message removes a basic legal uncertainty.
They can explore on-chain settlement, programmable payments, and shared ledger experiments without first having to argue that blockchain has created an entirely new category of deposit.
At the same time, they cannot treat the technology as a shortcut around existing prudential, operational, and consumer protection rules.
The statement is modest in length but significant in timing. Global banks and market infrastructure firms have been testing tokenized deposits for wholesale payments and atomic settlement.
Canada’s participation in international projects on tokenized finance sits in the same current. OSFI’s clarification does not prescribe a national product design.
It simply confirms that, under federal law, the deposit is still a deposit.Whether individual institutions move quickly will depend on operational readiness, interoperability across payment systems, and supervisory dialogue. The regulator has made the legal starting point clearer: substance over software.
