In the wake of the 2008 financial crisis, Canada garnered global praise for the stability, integrity, and sound regulation of its financial system.
Today, with cryptocurrencies taking their place as the world’s newest and fastest-growing asset class, Canada once again has an opportunity to lead and win — but only if we choose to do so.
The World Economic Forum projects that fully one-tenth of the global economy will exist on blockchain by 2025. Already, the combined market value of cryptocurrencies hovers close to USD $2 trillion, more than all US currency in circulation.
Many Canadians still perceive crypto as the niche obsession of a technologically savvy few. That’s becoming less and less accurate, with institutions like Goldman Sachs, Morgan Stanley, and Citigroup rapidly adopting crypto in response to investor demand. Here in Canada, the first-ever Bitcoin-based Exchange-Traded Fund (ETF) in North America swelled to over a billion dollars in its first two months.
And with governments around the world responding to the pandemic with huge increases in public spending, rising inflation and a decline in the buying power of fiat currencies are driving large corporate treasuries and individuals alike to diversify their portfolios with crypto assets as a long-term store of value.
Canadian financial and securities regulators have done important work to address the challenges of blockchain and crypto within existing legal frameworks — most notably the ongoing effort to register and regulate some 600 crypto exchanges operating in Canada. But there is much more work to do, including federal and provincial legislation purpose-built for the unique characteristics of blockchain and crypto assets — and the establishment of independent, purpose-built Canadian custodians for crypto, an essential bulwark of protection for all market participants.
The QuadrigaCX catastrophe, in which some 115,000 customers lost over $250 million in assets, is only the most extreme example of the risks to investors when regulation doesn’t keep pace with rapid technological change. Today, crypto remains the Wild West of the Canadian economy, as regulators work overtime to keep up – and the stakes are growing by the day.
This new financial revolution poses great challenges. But now, as in 2008, Canada has an opportunity to lead the world as a country that embraces the opportunities of blockchain, by supporting innovation while acting collaboratively, prudently, and with purpose to protect investors and consumers.
That’s where Brane comes in — bringing together a team of leaders from technology, banking, and government to build a truly Canadian solution for crypto custody.
Founded in Ottawa in 2017, Brane is an innovative fintech company that helps financial institutions and government agencies keep crypto safe for Canadians.
Brane’s uniquely qualified leadership team includes Jerome Dwight, a former CEO of Canadian operations for Bank of New York Mellon, the world’s largest custodian bank; Dave Revell, a former Global Chief Information Officer for CIBC; and former Ontario Premier Dalton McGuinty.
Custody is a key pillar of the financial system — providing all participants with assurance that their assets are protected from fraud, theft, and other risks. Reliable custody is especially critical when it comes to crypto, because the loss of a single private key can render assets unretrievable forever.
Right now, Canadian crypto investors — both institutions and individuals — rely heavily on a single U.S. company for the underlying custody of their digital assets. This concentration of risk with a foreign entity isn’t good for Canada, and it’s not sustainable.
Brane works with regulated Canadian financial institutions to provide licensed technology solutions, risk management best practices, and blockchain expertise that help keep crypto safe — empowering banks, asset managers, and investment dealers to meet their clients’ growing demand for Bitcoin, Ethereum, and other digital tokens.
Looking to the future, Brane is working with regulators to establish a Canadian crypto custody institution that’s not owned by or affiliated with any exchange or trading platform. The company is focused solely on keeping crypto safe for its clients and partners, using cutting-edge technology and risk management practices built on the regulatory compliance standards of the established financial sector.
What’s more, Brane is the first crypto custodian in the world to be certified carbon neutral, playing a leading role in making the crypto ecosystem more environmentally sustainable.
As a growing number of Canadian investors and institutions turn to crypto as part of their financial future, Brane will keep working to establish trust, credibility, and confidence in the sector – minimizing risk to maximize opportunity for all Canadians. Learn more at www.brane.ca/safe.
This piece was provided to QP Briefing by Brane Inc.