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2024 Budget: Crypto ETFs & Registered Accounts Consultation

Consultation | April 29, 2024

Your voice counts - 2024 Budget: Crypto ETFs & Registered Accounts Consultation

Department of Finance is Asking Whether Crypto ETFs Should Be Allowed in Canadian Registered Accounts

Buried in the supplementary notes of the 2024 Federal Budget, there's a key consultation question regarding the potential inclusion of cryptocurrencies as qualified investments in registered retirement and savings accounts like RRSPs and TFSAs.  Cryptocurrencies and non-fungible tokens (NFTs) are not considered "qualified investments" for RRSPs under current regulations. However, cryptocurrency-based exchange-traded funds (ETFs) that are listed on designated stock exchanges like the Toronto Stock Exchange (TSX) or the New York Stock Exchange (NYSE) do qualify as RRSP investments. This differentiation is crucial because it allows for indirect investment in the crypto market through regulated financial products that meet the legal standards for RRSPs.

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  • Currently, direct holdings of cryptocurrencies or NFTs in RRSPs could invoke a penalty tax of 50% of the fair market value of each non-qualified investment. However, the Canada Revenue Agency (CRA) has the discretion to waive this penalty under certain circumstances, such as reasonable error or where transactions also result in other taxable events.
  • There has been a surge in cryptocurrency-based ETFs, which are considered a safer way to include crypto investments in retirement plans due to their adherence to standard financial regulations and their presence on major stock exchanges.  Recently approved in the U.S.; Approved mid-April and starts trading April 30 in Hong Kong; Canada approved a raft of crypto ETFs years ago.
  • The federal government is actively seeking public feedback on whether cryptocurrency-based ETFs should be considered qualified investments for various registered plans. This consultation reflects a broader reassessment of the investment limitations imposed by the Income Tax Act on registered plans, which aim to ensure that these savings tools contain safe and stable investments. Historically, these rules have been designed to protect investors by limiting their exposure to more volatile and potentially risky assets.

Consultation Questions (learn more)

Budget 2024 encourages stakeholders to provide feedback on modernizing the rules for "qualified investments" to enhance the clarity and consistency of the Registered Plans system.

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  • Whether and how the rules relating to investments in small businesses could be harmonized to apply consistently to all registered savings plans.
  • Whether annuities that are qualified investments only for RRSPs, RRIFs, and RDSPs should continue to be qualified investments.
  • Whether the conditions that certain pooled investment products must meet to be a qualified investment are appropriate, including the ongoing value of maintaining a formal registration process for registered investments.
  • Whether and how qualified investment rules could promote an increase in Canadian-based investments.
  • Whether crypto-backed assets are appropriate as qualified investments for registered savings plans.

One key aspect under review is the harmonization of investment rules across different types of registered plans, which could lead to a more streamlined and understandable set of regulations for investors

Why This Matters - Your Voice Counts!

The outcome of this consultation could significantly impact Canadian investors, potentially broadening their investment choices within registered retirement and savings plans. This could offer a way to diversify retirement portfolios with assets that have not traditionally been part of these tax-advantaged accounts. Moreover, it aligns with a global trend of integrating digital assets into mainstream financial products, providing Canadian investors with opportunities that reflect the evolving financial landscape.

Canadians are invited to share their views on this topic by emailing their submissions to the Department of Finance at by July 15, 2024.

NCFA Jan 2018 resize - 2024 Budget: Crypto ETFs & Registered Accounts ConsultationThe National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit:

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