Crypto Regulations Need To Keep Pace With Market Growth: Bank Of Canada

The number of Canadians who own crypto assets is growing rapidly and efforts to regulate the sector need to keep pace, a Bank of Canada official said.

The number of Canadians who own crypto assets is growing rapidly and efforts to regulate the sector need to start keeping pace, a senior Bank of Canada official said, noting many people may not understand the risk of investing in products like bitcoin.

The issue is growing more pressing as crypto assets become integrated into Canada's financial system, increasing the risk that crypto shocks - like the recent price plunge - could end up hitting the broader financial system.

"This is an area that is still small, but it's growing really rapidly. And it is largely unregulated," Bank of Canada Senior Deputy Governor Carolyn Rogers told Reuters in an interview on Thursday. "We don't want to wait until it gets a lot larger before we bring regulatory controls in place."

The value of the global crypto asset market soared from $200 billion in early 2020 to $3 trillion at its peak, the Bank of Canada said in a report this week. The share of Canadians who own bitcoin more than doubled to 13% in 2021 from 5% in 2020.