Judging Risk Management, Not Industry

Many market participants operating in Canada’s digital asset sector are regulated entities in the financial system. When it comes to banking access, the challenge now is ensuring businesses that invest in governance, compliance, and sound risk management practices are assessed on the strength of those programs rather than assumptions about the sector in which they operate. 

Banking Access and Supervisory Uncertainty

Canada hasn’t followed the United States’ lead in discouraging banks from serving digital asset companies.¹ Instead, banking decisions here are largely risk based. However, in the absence of specific guidance on the effect of risk mitigating measures adopted by regulated financial intermediaries and their registration status, banks may arrive at a different assessment of residual risk, resulting in markedly different outcomes for regulated digital asset businesses in similar situations.

Figures released under the Access to Information Act show that between 2018 and 2023 The Financial Consumer Agency of Canada received over 800 complaints about bank account closures.² 

Under Canada’s anti-money laundering (AML) framework, virtual asset activities are considered highly vulnerable to money laundering and terrorist financing. A 2025 Assessment of Money Laundering and Terrorist Financing Risks draws a line. It recognizes that inherent vulnerability is not the same as residual risk after appropriate safeguards are in place.³  The distinction is important to note because companies operating in the same industry may present very different risk profiles once those measures are taken into account. 

We depend on financial institutions every day to earn a living, run a business, and participate in the Canadian economy. For some people working in the digital asset industry, banking challenges have extended beyond their businesses to their personal banking relationships.² 

Most of these decisions take place behind closed doors because banks are generally not required to explain when an account application is declined or an account is closed.²  This has left some founders with little understanding of why they were turned away. In some cases banks may be restricted from providing detailed reasons because of anti-money laundering or anti-terrorist obligations, including prohibitions on “tipping-off” customers in certain circumstances. It is important to point out that a lack of transparency should not automatically be mistaken for bad faith. Banks have to manage their own risks, and different institutions may make different decisions about the clients they choose to serve.