Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Category Archives: Research
Statistics Canada: Internet Usage Survey Data and Cyber Hurdles
Analysis | Aug 15, 2023
Image: Unsplash/Marc Olivier Jodoin
The digital revolution has touched every corner of the globe, and Canada is no exception. Recent data reveals a nation increasingly connected and reliant on the internet.
As the world rapidly shifts towards digital platforms, Canada stands as a testament to this evolution. From the bustling streets of Toronto to the serene landscapes of Yukon, the digital footprint is unmistakable. Recent data paints a picture of a nation increasingly intertwined with the virtual realm. Younger generations, predictably, lead the charge with near-total internet adoption. However, it's the rising curve of older Canadians coming online that tells a more profound story of digital inclusivity.
Internet Usage in Canada by Age Category (2018-2022)
- 15 to 24 years: This age group consistently exhibits the highest internet usage, almost reaching saturation with rates nearing 100%. Their near-universal adoption reflects the digital native nature of this younger generation, who have grown up in an era where the internet is integral to daily life.
- 25 to 44 years: Not far behind the youngest cohort, this age bracket also boasts impressively high internet adoption rates. This demographic, which often includes working professionals, students, and young families, relies heavily on the internet for work, entertainment, and social connectivity.
- 45 to 64 years: This age group, which spans mid-life professionals and those approaching retirement, has shown stable and substantial internet usage rates. The adoption is slightly lower than the younger demographics but remains significant, indicating the widespread importance of the internet across varied life stages.
See: From Gaming to Gig Economy: How Canadians are Embracing New Payment Methods
- 65 years and over: The percentage of internet usage for this senior group increased from 71.2% in 2018 to 82.6% in 2022, showcasing a noticeable and commendable upward trajectory in internet adoption. This trend embodies the impact of COVID and an increasing interest and need for the internet among older Canadians, whether for staying connected with loved ones, accessing services, or exploring new learning avenues.
Internet Security and Privacy Incidents
However, with this increased connectivity comes a surge in digital vulnerabilities. The data paints a concerning picture:
- The Vulnerable Middle: The age bracket "25 to 44 years" consistently emerges as the most susceptible to cyber incidents. In 2022, a significant 64.1% of individuals within this group reported experiencing a cyber security incident. This could be attributed to this age group's active online footprint – encompassing work, online shopping, social media, and more.
- Elders Navigating the Cyber Landscape: The senior population, while having a lower overall internet usage rate, has not been spared from cyber threats. Their reported incidents have seen a marked increase from 2018 to 2022. This rise is indicative of the challenges they face as they familiarize themselves with the digital realm.
- Privacy at Risk: Unsolicited emails and privacy breaches remain prevalent across all age groups, emphasizing the persistent threats to personal data in the digital age.
Emerging Threats and Securing the Future
Several emerging threats are becoming increasingly prominent. Among these, sophisticated phishing attacks are on the rise. These malicious endeavors, often disguised as authentic communications from trusted entities, prey on unsuspecting individuals, leading them to divulge personal or financial information.
Further, the rise of ransomware cannot be understated. Across the nation, businesses, educational institutions, and even local municipalities find themselves at the mercy of cybercriminals who encrypt critical data, demanding hefty ransoms for its release. Such incidents not only disrupt services but also place immense financial strains on the affected entities.
See: Blakes: Cybersecurity Trends in Canada: A 2023 Perspective
As we advance towards smarter homes and cities, the proliferation of Internet of Things (IoT) devices introduces new vulnerabilities. These interconnected devices, from home thermostats to citywide surveillance systems, often lack robust security measures, making them potential weak links in the vast digital network. As we revel in the conveniences of an interconnected world, it becomes imperative to address these emerging threats, ensuring that our digital future remains secure and resilient.
Takeaways
Navigating Canada's digital journey brings forth key areas for discussion. The need for digital literacy programs is evident, especially for older Canadians venturing online. With businesses and institutions rapidly digitizing, the resilience of our digital infrastructure becomes critical. Collaboration emerges as a central theme. Policymakers, tech firms, and the public must unite to bolster cybersecurity. As we embrace technology, a balanced approach ensures we reap its benefits while safeguarding against potential threats.
The 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, 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: www.ncfacanada.org
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Visa’s Solutions for the Creator Economy and Fintech Opportunities for Tomorrow’s Digital SMBs
Creator Economy | Aug 14, 2023
Image: Unsplash/Videodeck.co
The creator economy is evolving quickly with fintech innovations unlocking unprecedented monetization opportunities for content creators.
Tomorrow's Digital SMBs Lack Essential Financial Tools
The creator economy is often seen as the digital counterpart of traditional SMBs. These digital entrepreneurs, ranging from influencers and bloggers to artists and indie developers, are redefining the way we perceive small and mid-sized businesses (SMBs) - the Gig Economy. However, while they share many similarities in terms of business needs, the creator economy has its own set of challenges. For instance, creators, despite their ability to monetize their content, often find themselves treated as individual consumers rather than businesses. This distinction can lead to a lack of access to essential financial tools and services that are readily available to traditional SMBs.
Visa's Initiatives for the Creator Economy
Visa, with its global reach and expertise in the financial sector, has identified this gap and is keen on bridging it. The company believes that creators, much like SMBs, require robust financial solutions to manage inconsistent cash flows, slow platform payouts, and other challenges inherent to their profession. To address these challenges and empower creators, Visa has rolled out a series of initiatives:
- GetP@id Series: This innovative social video series is designed to foster mentorship within the creator community. By pairing up-and-coming creators with established professionals in fields like fashion, music, and food, the GetP@id Series offers a platform for knowledge exchange. Aspiring creators can gain firsthand insights and coaching from their mentors, benefiting not just the participants but also the wider audience.
See: Visa Files 2 Crypto Trademark Applications Including Crypto Wallet
- Visa Ready Creator Commerce Program: Recognizing the diverse platforms where creators operate, from social commerce sites to gaming companies, Visa has launched the Creator Commerce Program. This global initiative aims to seamlessly integrate financial tools into these platforms. Key features include faster and more flexible payout options through Visa Direct, as well as mechanisms for tipping and donations. By embedding these tools, Visa hopes to alleviate some of the financial pressures creators face, allowing them to focus on what they do best - creating.
Visa is not just recognizing the potential of the creator economy but is also investing in its future. As creators continue to push boundaries and redefine digital entrepreneurship, having robust financial partners like Visa will undoubtedly play a pivotal role in their success.
Secret Sauce of the Creator Economy
The creator economy is rapidly evolving, with new innovations and trends shaping its future. Here's a look at the latest developments and where the industry is headed:
- The creator economy has seen exponential growth, enabling millions to monetize their creativity through collaborations and brand partnerships.
- Influencer Marketing: It's not just about having a large following anymore. The key is engagement and relatability. Nano influencers and micro-influencers are becoming the future of influencer marketing.
- Creators have built genuine connections and authenticity with their audiences. Collaborating with values-aligned influencers can help brands leverage this trust.
See: Fintech Opportunities in the Wake of Tightened Credit Liquidity in Canada
- The creator economy allows brands to reach targeted niche audiences that align with their target consumers.
- Influencer marketing can be more cost-effective than traditional advertising channels. Nano influencers, with their authenticity and niche targeting, are ideal for influencer marketing.
- Collaborating with creators adds a human touch to brand marketing, allowing brands to tap into emerging trends and expand their reach.
A Closer Look at the Differences Between Creators versus SMBs
Here's a table comparing creators and SMBs (Small and Medium-sized Businesses) across key variables highlighting both the differences and similarities:
| Variable | Creators | SMBs |
| Primary Activity | Content creation (videos, blogs, art, music, etc.) | Product or service provision in various sectors (retail, manufacturing, services, etc.) |
| Revenue Source | Monetization of content (ads, sponsorships, merchandise, donations, etc.) | Sales of products/services, contracts, B2B transactions, etc. |
| Business Structure | Often individual or small teams; may not have formal business structures | Typically have formal business structures (LLC, Corporation, Partnership, etc.) |
| Financial Needs | Inconsistent cash flow, slow platform payouts, need for monetization tools | Regular cash flow management, inventory financing, capital expenditure, payroll, etc. |
| Client Interaction | Direct interaction with followers/fans; often through social media platforms | B2B or B2C interactions; may involve contracts, invoices, and formal agreements |
| Scale | Can be global from the start due to the nature of the internet | Often start local and expand regionally/nationally before going global |
| Regulatory Environment | Subject to platform-specific rules and online content regulations | Subject to industry-specific regulations, licensing, and compliance requirements |
| Tools & Platforms | Use of content creation tools, social media platforms, and monetization platforms | Use of business management software, CRM, ERP, industry-specific tools, etc. |
| Challenges | Platform algorithm changes, content theft, fluctuating audience engagement | Market competition, supply chain issues, regulatory compliance, economic downturns |
| Support Systems | Online creator communities, platform-specific support, mentorship programs (like Visa's GetP@id Series) | Industry associations, chambers of commerce, business mentorship programs, government SME support programs |
See: From Gaming to Gig Economy: How Canadians are Embracing New Payment Methods
10 Fintech Opportunities for the Emerging Creator Economy
Here are some top fintech opportunities and business models for creators, along with some examples:
| # | Opportunity | Description | Business Model |
|---|---|---|---|
| 1 | Digital Wallets & Payment Solutions | Offer seamless payment solutions for creators to receive funds from various platforms and currencies. | Transaction fees, subscription models, earning interest on stored funds. |
| 2 | Creator-specific Banking | Banks or financial platforms tailored to the needs of creators. | Monthly account fees, lending and overdraft fees, cross-selling other financial products. |
| 3 | Crowdfunding & Patronage Platforms | Platforms where creators can raise funds for specific projects or get support directly from their audience. | Taking a percentage of funds raised, subscription fees, advertising. |
| 4 | E-commerce Integration | Integrating e-commerce tools for creators to sell merchandise, digital products, or tickets to events. | Transaction fees, platform listing fees, subscription-based models. |
| 5 | Licensing & Royalty Management | Platforms that help creators license their content and manage royalties from multiple sources. | Commission on royalties collected, subscription fees, one-time licensing fees. |
| 6 | Financial Planning & Advisory for Creators | Offering financial planning services tailored to the unpredictable income streams of creators. | Fee-for-service, percentage of assets under management, subscription models. |
| 7 | Microloan Platforms | Providing short-term loans to creators based on projected earnings or upcoming contracts. | Interest on loans and associated fees. |
| 8 | Creator Insurance Products | Offering insurance products tailored to creators. | Premiums collected minus claims, cross-selling other insurance products. |
| 9 | Intellectual Property (IP) Marketplace | Platforms where creators can buy/sell IP rights or collaborate on joint projects. | Transaction fees, listing fees, subscription models. |
| 10 | Crypto & NFT Platforms for Creators | Platforms that enable creators to mint, sell, or auction Non-Fungible Tokens (NFTs) or receive cryptocurrency payments. | Transaction fees, minting fees, platform-specific tokens. |
Closing Thoughts
The creator economy is not just a fleeting trend; it's a dynamic and burgeoning sector that's reshaping the digital landscape. As creators continue to redefine entrepreneurship in the digital age, there lies a vast, untapped reservoir of opportunities for fintechs, banks, and financial institutions. By understanding the unique financial needs and challenges of creators, these entities have a golden chance to innovate, differentiate, and lead in a market that's ripe for disruption.
See: Monetizing the Creator Economy Through Social Tokens
The fusion of technology and finance has always been about breaking barriers and enabling dreams. Now, it's time to empower the dreams of millions of creators worldwide: Carpe Diem! Seize the day and be the financial backbone of the creator revolution.
The 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, 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: www.ncfacanada.org
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Bank of Canada Publishes Staff Paper on ‘Unmet Payment Needs and CBDCs
BoC Report | Aug 10, 2023
The Bank of Canada's latest staff paper on CBDCs navigates the intriguing crossroads of modern payment needs and the potential dawn of a cashless society with a Central Bank Digital Currency
The document analyzes the potential role of a CBDC in a cashless society and highlights the challenges associated with its adoption and use. The findings suggest that while a CBDC could offer solutions to some payment challenges, its success would depend on its widespread adoption by consumers and merchants.
Summary of Findings
- Background: titled "Unmet Payment Needs and a Central Bank Digital Currency" from the Bank of Canada, authored by Christopher S. Henry, Walter Engert, Alexandra Sutton-Lalani, Sebastian Hernandez, Darcey McVanel, and Kim P. Huynh, was last updated on August 10, 2023. The paper discusses the payment habits of Canadians in the current payment environment and in a hypothetical cashless scenario.
- Current Payment Habits: Most adult Canadians have access to a variety of payment methods, including cash, bank accounts, debit cards, and credit cards. This access would likely continue in a cashless environment (see Payment trends 2023). However, if merchants stopped accepting cash, some individuals could face challenges making payments.
See: Can Canada go Cashless?
- Adoption: For a CBDC to effectively address unmet payment needs, it would need to be widely adopted and used by the majority of consumers. This would encourage merchants to accept the CBDC, leading to further consumer adoption. However, since most consumers currently face few payment gaps, their incentive to adopt and use a CBDC might be limited. This suggests that introducing a CBDC to address the needs of a minority might be challenging.
- Cash Dependent: Some individuals heavily rely on cash for payments and financial management. They might be underbanked, value privacy, or have other reasons for preferring cash.
- Implications: The success of a CBDC in addressing unmet payment needs in a cashless society depends on its widespread adoption by the majority of consumers. If only a minority finds significant benefits from the CBDC, its widespread use and acceptance might be limited.
Image BoC staff paper
See: CBDC Adoption in Africa and Caribbean is Slow. India Piloting CBDC Anyway
Other Implementation Considerations
- Legal Status: Before anything else, the CBDC must be recognized as legal tender in Canada. This ensures its universal acceptance for all debts, both public and private. The challenge lies in defining its legal status vis-à-vis other forms of money and ensuring its widespread acceptance.
- Financial Stability and Sensible Monetary Policy: A CBDC would need to fit seamlessly into Canada's broader monetary policy framework. Policymakers would need to ensure that its introduction doesn't destabilize the financial system, especially by leading to bank disintermediation.
- Privacy with Oversight: One of the significant advantages of digital currencies is transparency. However, this comes with privacy concerns. Regulations must strike a balance between individual privacy rights and the need for transactional transparency, especially concerning anti-money laundering and combating terrorism financing.
- Interoperability: For the CBDC to be effective, it must be interoperable with existing payment systems and potentially other CBDCs or digital currencies. This poses technical challenges and requires ensuring seamless integration. Worth noting that the IMF is working on a CBDC platform for global remittances.
- Consumer Protection: With new technology comes new risks. Regulations must be in place to protect consumers from potential risks associated with CBDC use. This involves public education and robust security measures.
- Role for Banks and Financial Institutions: Commercial banks and financial institutions play a pivotal role in the financial landscape and their role in the distribution and management of the CBDC must be clearly defined.
- Navigating International Waters: Lastly, for the CBDC to be globally relevant, Canada must collaborate with international partners. This ensures the CBDC's use for cross-border transactions aligns with global standards.
See: China’s CBDC: Offline Digital Yuan Payments via Super SIM Cards
In Conclusion
The introduction of a CBDC in Canada is a monumental task, requiring meticulous planning, stakeholder consultations, and iterative refinements. While the potential benefits are significant, the journey is long and filled with challenges. However, with a clear regulatory roadmap, Canada can position itself at the forefront of the digital currency revolution.
The 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, 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: www.ncfacanada.org
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Blockchain Coalition Report: The State of Web3 in the U.S. – State by State Analysis
Report | Aug 4, 2023
The USBC, in collaboration with Moonbeam Exchange, has released a report titled "The State of Web3 - Economic Activity Analysis Across the U.S." This report explores the current Web3 landscape within each state, highlighting investment, startup activity, innovation ecosystems, and academic research.
Web3 represents a transformative shift towards a decentralized, user-centric, and inclusive internet. It envisions a future where transactions and interactions occur directly between peers, eliminating the need for intermediaries. Associated with blockchain and cryptocurrency, Web3 is attracting attention from various stakeholders, including developers, entrepreneurs, regulators, investors, and more.
Founded in June 2021, the USBC is the only organization with a multi-state focused approach. It seeks consistent policies at the state level through alignment on public policy and legislative priorities, building relationships with regulatory bodies, and seeking new partnerships to grow the sector across the country.
See: Incubella Publishes Research on the 2022 Canadian Web3 Landscape
Key Findings
- Web3 is no longer a nascent industry; it has a significant impact on the economy and workforce.
- 276 of Fortune 1000 companies are focusing on Web3 R&D.
- Since 2008, the Web3 industry has created over 200,000 jobs and received over $107 billion in capital investments.
- The U.S. is a hub of blockchain innovation, with more than 5,700 Web3 related startups launched since 2007.
- Federal government investment in blockchain is steadily increasing.
National Takeaways
- Enterprise applications of Web3 are gaining traction in sectors like finance, technology, retail, media, and healthcare.
- The Web3 industry has created 30 unicorns and 257 exits since 2008.
- Regulatory clarity and support correlate with increased investment.
- Government is a growing adopter and funder of Web3 R&D.
Read: Canadian Government Publishes Report with 16 Recommendations: Calls for a National Blockchain Strategy to Support Adoption and Industry Growth
State-Level Insights
- California, New York, Florida, and Texas are home to 61% of all startups in the industry.
- Smaller states like Texas, Georgia, Delaware, Nevada, Wyoming, New Jersey, and Utah are making significant impacts.
- Notable single-industry players include Tennessee (healthcare), Nevada (gaming), and Maryland (Government).
Access the full 107 page PDF report --> here
The 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, 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: www.ncfacanada.org
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Generative AI: Hype or Reality? An Investment Perspective
Report | Jul 28, 2023
In the rapidly evolving world of technology, distinguishing between hype and reality can be a daunting task, especially when it comes to the realm of artificial intelligence (AI). One of the most intriguing and debated areas in this field is generative AI. But is it all hype, or does it hold transformative potential that could revolutionize various industries and warrant investment today?
Generative AI, a subset of AI, is a technology that leverages machine learning algorithms to generate data similar to the one it's trained on. It's the technology behind deepfakes, AI-generated art, and even some forms of music composition. The potential applications are vast, ranging from content creation to drug discovery, making it a hot topic for investors.
According to a report by Goldman Sachs:
"[Generative AI is] poised to drive significant economic and societal impact, similar to the introduction of electricity and the internet."
See: DishBrain’s Semi-Biological Computer Chip Attracts Military Funding: Lab-Grown Brain Cells Capable of Playing ‘Pong’
This statement underscores the transformative potential of generative AI, but it also raises questions about its current state and whether it's ripe for investment.
The report further states, "Generative AI could contribute up to $4.1tn to the global economy by 2030." This projection is based on the potential of generative AI to enhance productivity, create new business opportunities, and drive innovation across various sectors. However, it's essential to note that these benefits are not guaranteed and depend on several factors, including technological advancements, regulatory environment, and market acceptance.
Investment in generative AI should be strategic and informed. Here are a few strategies to consider:
- Diversify: Just like any other investment, diversification is key. Consider investing in a mix of established companies that are incorporating generative AI into their operations and startups that are at the forefront of generative AI innovation.
- Stay Informed: The landscape of AI is constantly changing. Stay updated with the latest developments in the field, understand the technological advancements, and keep an eye on the regulatory environment.
- Long-term Perspective: Given the nascent stage of generative AI, it's crucial to have a long-term investment perspective. The significant economic impact is likely to be realized over a decade or more.
Read: Future of Neobanking: Exploring the Landscape of AI-Powered Digital Banks
In conclusion, while generative AI holds immense potential, it's essential to approach it with a balanced perspective. Investing in generative AI today could yield significant returns in the future, but it's not without risks. As always, thorough research and a well-thought-out investment strategy are crucial.
"Generative AI is not just hype; it's a transformative technology that could reshape our world. But like all transformative technologies, it will take time to reach its full potential."
Download the 28 page PDF report --> here
The 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, 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: www.ncfacanada.org
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CCAF Report: The State of SupTech in 2022
CCAF SupTech Report | Jul 17, 2023
The Cambridge SupTech Lab's "State of SupTech Report 2022" provides a comprehensive analysis of the current state of supervisory technologies (suptech) and their adoption by financial authorities worldwide.
What is SupTech?
SupTech, short for Supervisory Technology, refers to the use of innovative technologies by financial supervisory authorities to enhance and streamline their regulatory processes. It involves the application of tools such as artificial intelligence, machine learning, data analytics, and cloud computing to improve data collection, analysis, and reporting.
SupTech can enhance regulatory efficiency, improve risk management, and enable real-time monitoring and proactive supervision. It's a growing field that's part of the broader digital transformation of the financial sector, helping regulators keep pace with rapid technological advancements in finance.
While SupTech is growing there are significant barriers to implementation and differences between advanced and emerging economies
See: OSC Publishes TestLab 2022 Report: Exploring Innovations in RegTech with Participate Solutions
- SupTech is Gaining Traction
- The report reveals that suptech is gaining traction, with 71% of financial authorities already engaged in suptech initiatives. However, most efforts remain in the experimentation stage, primarily focused on improving data collection and basic analysis.
- The majority of suptech applications focus on consumer protection supervision (59%) and prudential supervision use cases (58%).
- Suptech is enabling new supervisory use cases that would not otherwise be possible, such as ingesting massive online datasets like social media streams to conduct sentiment analysis, parse online reviews to assess risks or identify fraudulent fintech apps, and conduct real-time, on-chain analysis for digital assets supervision.
- Significant Barriers
- Budget limitations, data quality, and technical skills are the most significant barriers to implementing suptech.
- There is a notable mismatch between the experiences of financial authorities and vendors when it comes to procurement, with tech providers urging public agencies to address legacy procurement processes.
- Differences between Emerging Markets and Advanced Economies
- Financial authorities in advanced economies (AEs) are early adopters of suptech, have sufficient digital infrastructure, assign dedicated suptech roles and departments, and have seen more substantial internal outcomes than those in emerging markets and developing economies (EMDEs).
- EMDEs agencies tend to run suptech initiatives within the supervision department itself, are more interested in trainings, technical assistance, digital tools, and seek funding primarily for solutions design and development.
Case Study: Central Bank of the Netherlands' - AML/CFT/PF Detection Tool
The report includes several case studies. One great example is how the Central Bank of the Netherlands (DNB) developed an outlier detection tool to enhance its AML/CFT/PF supervision. The tool uses machine learning algorithms to identify unusual patterns in the data submitted by financial institutions. The tool's primary purpose is to detect outliers that may indicate risks related to money laundering, terrorist financing, and proliferation financing.
See: Financial Institutions and Regulators Alike are Showing Growing Interest in Fintech and Regtech Solutions.
- The tool was developed in-house by the DNB's Data Science team, which worked closely with the AML/CFT/PF supervision team. The tool uses a combination of unsupervised machine learning techniques, including clustering and anomaly detection algorithms, to identify outliers in the data.
- The tool has been successful in identifying outliers that were not detected by traditional methods.
- It has also helped the DNB to better understand the risks associated with different types of financial institutions and to prioritize its supervisory activities accordingly.
- The DNB plans to further develop the tool by incorporating additional data sources and improving the interpretability of the machine learning models. The bank is also exploring the possibility of sharing the tool with other financial authorities.
Our colleagues in integrity supervision can now do their work in a more efficient manner by selecting the riskiest files using data science.
This case study demonstrates the potential of suptech to enhance financial supervision and address complex challenges such as money laundering and terrorist financing. It also highlights the importance of collaboration between data scientists and supervisors in developing effective suptech solutions.
Further Reading
- Startup Statistics Guide by Founders Forum Group – A comprehensive, data-rich resource for founders looking for real insights on growth, funding, and market trends.
The 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, 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: www.ncfacanada.org
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Canadian Government Publishes Report with 16 Recommendations: Calls for a National Blockchain Strategy to Support Adoption and Industry Growth
Report | July 13, 2023
Standing Committee on Industry Technology publishes report with recommendations and calls for a National blockchain strategy, clarify regulation and support industry growth and adoption
- Last month in June 2023, the Standing Committee on Industry and Technology, chaired by Joël Lightbound, published a report titled "Blockchain Technology: Cryptocurrencies and Beyond" that explores the potential of blockchain technology and cryptocurrencies, their impact on various industries, and the challenges they present.
- It also provides recommendations for the Canadian government to support and regulate this emerging industry. It emphasizes the need for regulatory clarity and consumer protection in the field of digital assets. The report also suggests the establishment of a national blockchain strategy, following consultation with provinces and stakeholders.
The report includes a long list of 16 recommendations:
- The Government of Canada should recognize blockchain as an emerging industry with significant long-term economic and job creation opportunities.
- The government should improve consumer protection and regulatory clarity in the field of digital assets, ensuring individuals' right to self custody and ease of access to safe and reliable on and off ramps.
- The Government of Canada should establish a national blockchain strategy, following consultation with provinces and stakeholders, to clarify policy direction and regulatory approach.
- The government should call on a group of experts, entrepreneurs, academics, and investors to support its analysis and understanding of blockchain technology and help determine the best steps forward.
- The Government of Canada should pursue opportunities for international cooperation in the development of blockchain regulations and policies, including with major trading partners.
See: Bloomberg Invest: Banking and Blockchain Conversation with Former SEC Chair Jay Clayton and Dan Morehead of Pantera Capital
- The government should conduct innovative pilot projects using distributed ledgers to help strengthen the ecosystem and recognize up-and-coming businesses.
- The Government of Canada should create a sandbox where entrepreneurs can test technologies unhindered by as yet unadopted regulations.
- The government should adopt a distinct regulatory approach to stablecoins that reflects the difference between these products and other cryptocurrencies.
- The Government of Canada should adopt regulatory changes to promote the establishment of federally regulated cryptocurrency custodians to meet the demand for cold storage services from Canadian cryptocurrency firms.
- The government should adopt measures for access to banking and insurance services for blockchain firms, including through Crown corporations.
- The Government of Canada should establish a public awareness campaign, in consultation with provinces and the industry, to educate the public about risks related to cryptocurrencies and the benefits of accessing cryptocurrency markets through regulated Canadian entities.
- The government should launch a strategic initiative to develop skills and talent and support research in the blockchain sector.
- The Government of Canada should investigate ways to promote the adoption of blockchain technology in supply chains.
Read: Citi Report: Blockchain’s Next Billion Users: Money, Tokens, Games
- The government, in collaboration with the Commissioner of Canada Elections, should undertake a study on the new opportunities this technology presents for electronic voting, consultation, and the modernization of democratic institutions.
- The government should investigate equity between provinces in the application of the Excise Tax Act to mining activities to ensure fair taxation.
- The government should maintain that digital asset mining constitutes a commercial activity in Canada and adopt a neutral and equitable position towards this new and growing industry.
The 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, 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: www.ncfacanada.org
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