Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Category Archives: Enterprise, Scaleup
OSFI Approves Santander for Canadian Banking License
Banking License | April 7, 2025
Image: Freepik/rawpixel.com
Banco Santander Is Now a Canadian Bank
After almost a six year wait, Banco Santander has secured a Schedule II banking license in Canada, an achievement that could ramp up digital competition in banking. Santander first applied for a Canadian banking license back in July 2019. After a long multi-year regulatory process, Santander received letters patent from Canada’s Minister of Finance in June 2024, a required step to establish a new bank under federal law. Last weekend in the official government gazette newsletter, stated that the Office of the Superintendent of Financial Institutions (OSFI) issued an order for Santander to 'commence and carry on business early last month - meaning its clear to operate.
Santander is the largest bank in Spain (and one of the largest in Europe), and the new license will allow it to offer full retail banking services, such as deposit taking, lending, credit cards, and wealth management products and services. This approval places Santander alongside other foreign banks operating as Schedule II subsidiaries in Canada , such as Citibank Canada, ICICI Bank Canada, Amex Bank of Canada, and others. It also raises fresh questions about the future of competition, digital transformation, and fintech collaboration in Canada’s tightly held banking industry.
From Auto Loans to Full Retail Banking in Canada
Although the Canadian banking license is new, Santander has been operating in Canada for more than a decade by acquiring Carfinco Financial Group, a company focused on automobile financing. So Santander already has a foothold in the Canadian market but now with a retail banking license, they can now expand offerings.
See: Founder Salaries: Insights from Europe, U.S., and Canada
Santander bank is already a major player in Europe and Latin America, and it operates in the U.S. and Mexico through a mix of consumer lending, auto finance, and digital-first retail banking. From Banco Santander's 2024 Annual Report, here's what sets them apart:
- €12.57 billion in net profit in 2024
- Over 168 million customers worldwide
- A return on tangible equity of 16.3% (one of the strongest in global banking)
- Ranked 16th globally by total assets
Its Canadian strategy definitely won't be going toe to toe against incumbent banks like RBC, Scotia or BMO by opening up hundreds of physical branches. Santander is more likely to curate niche offerings in personal finance and use its robust digital infrastructure to scale quickly and efficiently.
A Market Where Entry Is Rare, Not Impossible
According to The Logic, Santander’s license is one of just 11 new federal banking licenses granted in Canada over the past 10 years. So, yes this license is pretty big news to competition aficionados.
Recently on March 4 2025, President Trump complained on his Truth Social platform that "Canada doesn’t allow American banks to do business in Canada, but their banks flood the American market. Oh, that seems fair to me, doesn’t it?” However this is not really accurate given that there are at least a dozen of U.S. Financial Institutions currently operating in Canada including 3 who also have a schedule II license the same as Santander.
So, U.S. banks can operate here in Canada but they face regulatory and market challenges, since foreign banks must either collaborate with a Canadian partner, setup a Canadian subsidiary, or get government approval to do business here. There are also foreign ownership restrictions preventing them from acquiring Canadian banks and their licenses outright. Canadian consumers may also prefer working with one of the big six Canadian banks or the inherent trust of walking into a physical branch.
See: Canada Post Launches Postal Banking With KOHO
The door to a banking license isn't locked for qualified foreign banks but they'll need to meet rigorous standards of risk management and governance. Santander's success in receiving a Canadian banking license may open the pathway for more foreign digital-first banks interested in entering Canadian markets.
Santander's Digital Platform and Partnership Potential
Santander is bringing more than just capital and niche retail services to Canada. They have a fully developed digital platform and a strong history of working with financial technologies. They even have their own fintech division that operates PagoNxt, their global payment service offering with tools for merchants and embedded finance features that can be integrated into both banking and non-bank platforms.
Santander also owns Openbank, which has grown into Europe’s largest digital only bank by deposits.
See: Will Competition Reforms Boost Fintech? Inside the Fight
As of May 2022, Santander had moved over 80% of their global it infrastructure to the cloud, which means they are a cloud-native system that can launch products quickly, iterate, and experiment with tools that traditional banks would likely take years to develop (without similar infrastructure).
For fintechs working on API based banking, automated lending and other similar innovative and novel products and services, Santander could be more than a competitor but a potential partner who can bring capital, research, and tech enablement all in one place, and ready to go.
Open Banking Would Boost Santander and Fintech Growth
Is Santander's license approval tied in some way to Canada's imminent open banking rollout (expected in 2026) or the need to diversify and strengthen Canada's economy?
While the timing is certainly interesting, and there may be some nuanced reasons into the approval of Santander's license, we'll refrain from any speculation and just reiterate that when consumer-driven finance finally arrives in Canada, it will help newer brands like Santander to connect with more customers, offer new products/services, and deepen financial relationships, all powered by artificial intelligence and cloud-native systems.
See: Robinhood’s WealthTech Push and Lifestyle Finance
As Investment Executive noted, Canada's largest banks have long benefited from their exclusive access to consumer data. Open banking could begin to shift that balance. And let's be clear, that shift will take time but open banking may certainly allow for more experimentation, more competition, and more chances for fintech firms and digital banks like Santander to connect with customers in new ways.
Take Aways
For NCFA's community, Santander’s arrival is a sign that the ecosystem is evolving. Canada’s financial future is bound to become more digital, more connected, and hopefully more competitive than ever. For fintech firms building in lending, onboarding, or data innovation, now is the time to explore how players like Santander could support growth through partnership.
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, 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: www.ncfacanada.org
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Zelle App Shuts Down, Shift to Bank Integrations
Payments | April 7, 2025
Image: Freepik/wayhomestudio
Zelle App Shuts Down, Service Still Going Strong
In 2017, Zelle, a U.S. payment service launched by a consortium of major banks and credit unions to compete against fintechs, enabled people to send money directly between accounts, instantly and securely. It's similar to Canada's Interac e-Transfer service but built for U.S. markets and has larger volumes.
Last October, Zelle updated consumers on their plan to shut down the Zelle app because most users were already using Zelle transfer services from within their banking apps. In fact, according to Early Warning Services LLC (the consortium that runs Zelle), 98% of Zelle's $1 trillion of transactions in 2024 took place through participating financial institutions and only 2% using the Zelle app.
See: Bank CEOs Defend P2P Payments Network Zelle in Senate Hearing Over Consumer Fraud Handling
Zelle’s payment network now connects over 2,200 banks and credit unions, and has 151 million American users that trust it to send money directly from their accounts. The story isn't all sunshine though, as Zelle faced significant scrutiny over fraud and scam concerns. In late 2024, the U.S. Consumer Financial Protection Bureau (CFPB) sued several large banks over their handling of fraud on the Zelle network. The complaint was dropped in early 2025, but the questions around user protection remain.
Implications and Lessons
There are some key lessons for Canadian fintechs and credit unions with the news that Zelle is shutting down its dedicated app and continuing to grow through banking apps.
First, it shows that deep internal integrations within banks still work. Each financial institution that offers Zelle builds it directly into their own mobile or online banking platforms. They all use shared infrastructure provided by Early Warning Services LLC, the company that runs the Zelle service, which is owned by the banks themselves.
While the bank integrations of Zelle's payment services seems like embedded finance, it's not the same how fintechs are using the term today. Zelle isn’t being embedded into third party platforms or consumer apps, such as non-financial e-commerce sites. There’s no third-party fintech providing the payments layer. Instead, Zelle operates like a closed payments network run by banks, where each institution manages its own compliance and risk but share the same rails.
See: Zelle’s New Refund Policy Might Set New Standard
The model proves that bank collaborations can scale, allowing them to compete with financial technology competitors. By integrating Zelle into their own systems (legacy or otherwise), banks offered users a trusted way to send money without requiring the setup of another application. So, even though Zelle had a brand, a good UX/UI and performed well, users preferred to use the tools available inside their trusted bank app that they already use.
Another key lessons here is that as Zelle grew, so did fraud concerns. Regulators raised alarms about scams and missing consumer protections. The lessons is, the bigger your network gets, the more important it is to invest in fraud prevention, user education, and strong governance and oversight, to support growth.
Lastly, the same group of banks behind Zelle also launched a digital wallet called Paze, designed to make online shopping faster by allowing people to check out without typing in card details. It's part of the same strategy, and another example where banks are providing trusted payment tools within the banking system instead of relying on third party fintech apps.
Conclusion
Trust is fragile. Building a successful payment or fintech service doesn't always require a flashy new app, if you users can use the service where they already are or inside a trusted environment. The Zelle story also highlights that bank-led collaborations can compete with fintech innovation at scale, if well executed and governed.
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, 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: www.ncfacanada.org
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Programming Trends 2025
April 7, 2025
We can only compare the modern pace of life to the rapid development of technology. Everything is constantly changing and evolving; you risk becoming obsolete if you don't keep up with these changes. That's why we at Muteki Group have compiled a short article with programming trends 2025. This will help you incorporate new strategies into your development plan for this year.
Additional Power: Muteki Group CTO as a Service
Strategic leadership is vital for enterprises looking for effective scaling in 2025. Not all startups and small businesses can afford to hire a full-time high-level Chief Technology Officer (CTO) throughout the development cycle. In reality, the role of a CTO is often only necessary at specific strategic points during development. Our experience working with businesses of various sizes has shown us that even skilled development teams benefit from having strategic leadership on their projects. A practical solution to this dilemma is outsourcing this role and choosing Muteki Group CTO as a service.
By collaborating with Muteki Group, you can take advantage of our CTO as a Service, which allows you to access strategic leadership on a subscription basis. This approach means you only engage a CTO as needed, helping you avoid the financial burden of a full-time hire, and only pay for the hours when the CTO is actively working on your project. Additionally, if your project's needs change and require a CTO with different expertise, we can provide you with a suitable candidate.
We offer three packages for our CTO as a Service: full-time, part-time, or on-demand cooperation, allowing you to invite a specialist whenever you need one. This flexible cooperation model ensures you have the strategic leadership necessary to thrive in a rapidly evolving technological landscape.
Programming trends 2025
The programming is evolving due to the influence of AI, the increasing demand for quicker project launches, and the rise of low-code platforms. These significant trends are set to shape the industry's future. Let's explore the most impactful trends that are expected to affect the whole 2025 year.
1. AI is changing how software is developed, tested, and maintained. Developers want to maximize their work routines with AI by delegating simple functions. On the other hand, the positive news is that developers will have time for more creative tasks. At Muteki Group, we have a free AI consulting service that will allow you to understand which areas AI will be effective for your business in 2025.
2. Low-code platforms let users you develop some simple functions without needing programming skills. Their popularity is growing because they offer flexibility.
3. Cloud development is becoming the industry standard, especially with the rise of microservices. By 2025, edge computing—processing data closer to users—will help improve the performance of Internet of Things (IoT) devices and real-time applications.
4. As cyber threats increase, security is now a key part of software development. The more user data a business handles, the stricter the rules it must follow to protect that data. For financial projects, blockchain has become a trend because it offers a secure way to handle transactions and verify identities.
5. Users want fresh experiences, which is why virtual reality (VR), augmented reality (AR), and IoT will still be in demand in 2025. At Muteki Group, we assist companies in adapting to this new landscape, from choosing the right platforms to creating engaging experiences.
6. The push for environmental friendliness is changing how developers use technology. Green coding means optimizing software to lower energy use, making apps better for the environment.
2025 year brings some tech changes and we must use these changes to our advantage. Technology will keep evolving, and businesses must keep up with trends to provide the experiences users want. This includes using AI, VR, AR, and the Internet of Things, as these technologies can offer more than standard mobile apps or websites.
See: Disruptive Innovations Driving Global Change in 2025
You need strong leadership and a skilled, dedicated development team to implement your tech idea to stay competitive entirely. At Muteki Group, we have been building dedicated development teams since 2015. We access the Ukrainian IT market, allowing us to develop a team that meets your specific needs at brilliant rates. Contact Muteki Group to develop innovative solutions!
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, 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: www.ncfacanada.org
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Klarna Delays IPO As Markets React to Trump’s Tariffs
Financing | April 4, 2025
Image: Stock Markets Since Trump's Inauguration (New York Times)
Klarna Delays U.S. IPO Plans After Trump’s Tariffs Break Markets
As Reuters and Wall Street Journal reported, Swedish fintech giant Klarna is now delaying its U.S. IPO plans after President Trump's wide sweeping universal tariffs and country specific tariffs were announced on April 2, just two days prior, triggering heavy market volatility and declining market pressures.
See: Five Ways Countries Are Responding to Trump’s Tariffs
Klarna, known for its "buy now pay later" services (BNPL) was preparing to go public on the New York Stock Exchange under the ticker symbol KLAR but has delayed the launch saying it's due to uncertainty in the market environment. In its filing, the company flagged global trade policies and tariffs as a potential risk that could hurt consumer spending and merchant revenues, both are important for Klarna's business model.
Klarna's filing said:
"A downturn in the general economic environment or a slower pace of economic growth, including as a result of changes in international trade policies... can lead to decreased consumer spending and adversely affect the financial condition of our merchants."
What It Means for Fintech and Investors
Trump's tariffs have no doubt damped investor confidence. Klarna's delay is a setback for the fintech sector and anyone looking for a rebound in IPO activity. Klarna is one of the most high profile fintechs in Europe, and its imminent U.S. IPO listing was closely watched as a measure of investor confidence in the BNPL model.
See: 10 Fintech and Crypto IPOs 2025 – Boom or Bubble?
This IPO freeze highlights how geopolitical risks can directly impact fintech growth and public market access. With President Trump's protectionist policies, global fintechs looking to operate and access U.S. markets will now face new layers of risk and potential setbacks.
Conclusion
The current U.S. IPO environment is in a fragile state due to uncertainty and unpredictability of policy driven market shocks.
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, 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: www.ncfacanada.org
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OSC Green Lights Kraken’s Restricted Dealer Status
Crypto | April 4, 2025
Image courtesy of Kraken's blog post
OSC Approves Restricted Dealer License for Kraken to Operate Nationally in Canada
On April 2 2025, Kraken (Payward Canada Inc.) announced that it officially received approval as a Restricted Dealer, under the new registration framework for crypto platforms. The Ontario Securities Commission (OSC) issued Payward Canada Inc's approval order (63 page PDF) and has updated their live registry of 'Registered Crypto Asset Trading Platforms', which applies nationally under the passport system that allows provinces and territories to recognize each other's decisions, so Kraken is open for business from coast to coast, from B.C. to Newfoundland to Nunavut.
Kraken also announced that based in Toronto, Cynthia Del Pozo, is its new General Manager for North America and will focus on strengthening the firms regulatory, political and commercial partnerships and scale Kraken's growth and brand across North America. To celebrate the registration milestone, Kraken is offering free Interact e-Transfer deposits for Canadians, making it easier and cheaper for users to onboard funds onto the platform.
See: Kraken Acquires Retail Futures NinjaTrader $1.5B
In Kraken's blog post, it acknowledges that Canada has played a pioneering role in crypto adoption by being the first country to install a public Bitcoin ATM (downtown Vancouver) and also the first to launch a regulated spot Bitcoin and Ethereum ETFs in 2021.
Kraken Canada's Achievements
Over the past two years, Kraken has been scaling up its activity and presence in Canada:
- Doubling its Canadian workforce and number of active users
- Surpassing $2 billion CAD in client assets under custody(announced November 2024)
- Launching Canadian dollar trading pairs to help clients avoid foreign exchange fees
- Laying groundwork to serve institutional investors seeking regulated crypto access
Limitations with Kraken's Restricted Dealer License
While obtaining a Restricted Dealer registration status is a clear win, there are some key limitations and safeguards that Kraken Canada must follow, providing a clearer picture of how the OSC and other provincial regulators are tightening crypto rules.
1. Kraken Canada's users' assets aren't insured by the Canadian Investor Protection Fund (CIPF). That means if something goes wrong with the platform, there’s no insurance on your assets. Every user has to agree to this before they can trade.
2. Kraken’s Flexible Staking program that allows users to earn rewards while keeping control of their crypto must shut down within 120 days of April 1 unless regulators grant approval or an extension. New users are already blocked from joining it.
3. Kraken isn’t allowed to help create or promote new cryptocurrencies unless it gets the green light from regulators. This rule helps prevent conflicts of interest between Kraken and the projects/tkens listed on its platform.
See: SEC Drops Yuga Labs Investigation and Kraken Case
4. If a token is labelled a security or derivative by a regulator (in Canada or elsewhere), or if the people behind it have a track record of fraud, money laundering, or other serious violations, Kraken has to stop offering it right away.
5. Canadians can only access Kraken through its local Canadian platform (overseen by Canadian regulators), and not Kraken's global site.
6. Kraken isn’t allowed to include its own crypto holdings (unless those assets are connected to client accounts) when reporting its financial position. This keeps the company from padding its numbers with risky or volatile assets.
7. Kraken isn’t allowed to trade crypto for its own profit (can't be a market maker). It can only trade/fill client orders or manage risk. That means no speculative bets or operating a money making trading desk behind the scenes.
How Kraken’s Current Status Compares to the Next Regulatory Tier
Kraken also plans to apply for full investment dealer registration and join the Canadian Investment Regulatory Organization (CIRO), which would allow it to offer more services including an Alternative Trading System (ATS) for crypto trades.
See: Kraken’s Strategy for Canadian Market Growth
| Feature | Restricted Dealer (Kraken now) | Investment Dealer + ATS (Kraken future) |
| Regulatory Status | Temporary or limited-purpose license | Full dealer registration under securities law |
| Regulator | OSC + CSA with PRUs | CIRO (formerly IIROC) + OSC/CSA |
| Membership | Not a member of CIRO | Full CIRO member |
| Investor Protection | No CIPF coverage | Yes — CIPF protection for client funds |
| Eligible Clients | Retail and institutional | Retail, institutional, advisory, discretionary |
| Crypto Products | Crypto Contracts only (not securities) | Potentially securities, derivatives, asset-backed tokens |
| Trading Venue | Not a formal exchange or ATS | Can operate an ATS |
| Staking Products | Allowed with restrictions | Subject to broader oversight, possibly wider offering with CIRO approval |
| Market Making | Not permitted | May be permitted under ATS/marketplace rules |
| Capital Requirements | Lower — tailored to risk | Much higher; must meet CIRO's ongoing capital tests |
| Surveillance & Audit | Periodic OSC reporting | CIRO-mandated audits, books & records, daily capital reports |
| Risk Assessment | Suitability per trade (retail) | Full KYC, suitability, supervisory systems, conflict management |
Outlook
Kraken’s approval shows that crypto in Canada is moving into a more regulated phase with greater protection, clearer rules, and more accountability/responsibility. Kraken’s next step is to become a full investment dealer, which could lead to new services and even stronger safeguards for users.
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, 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: www.ncfacanada.org
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Five Ways Countries Are Responding to Trump’s Tariffs
Tariffs | April 3, 2025
Image: Freepik/rawpixel.com
How Countries Are Responding to Trump’s Tariffs And What Happens Next
On April 2, U.S. President Donald Trump introduced a massive set of new import tariffs. Starting April 5, a universal 10% tariff will apply to all imports coming into the U.S. Additionally, certain countries that the administration considers to have unfair trade practices with the U.S. will face even higher tariffs, between 20% - 49%.
See: Trump’s April 2025 Tariffs and What They Mean for Canada
Canada and Mexico were spared this tariff round but they’re still dealing with a separate 25% tariff that was put in place back in March, which were linked to concerns about fentanyl and border issues. In response, Canada has now fired back with its own 25% tariff on U.S. vehicles that don’t meet USMCA rules (applies to $35.6 billion CAD of imports). This is no longer political jockeying.
So what are other countries doing in response? And how might this play out?
Five Ways Countries Are Responding
Several countries have already responded to the wide sweeping tariffs albeit in noticeably different ways (and strategies):
1. Outright rejection - China (54% tariffs) strongly condemned the move, demanding that they 'immediately cancel' the tariffs. Beijing warned of major disruption to global supply chains and didn't rule out retaliation. April 4 update: China responds to Trump's trade war, China's Finance Minster, "For all imported goods originating from the US, an additional tariff of 34% on top of the current applicable tariff rate will be imposed."China will also escalate restrictions on exporting 'rare earth' minerals to the U.S. Markets plunge further.
2. Warning with possible retaliation - The European Union (20% tariffs) said it would respond in a "legitimate, proportionate and decisive" way.
3. Diplomatic concern, open to talks - Japan (24%), India (26%), Taiwan (32%), and Thailand (36%) expressed concern but stressed willingness to work with the U.S. to find solutions. These responders look to want to preserve economic ties.
See: Digital Export Trends and Global Trade Fintech Opportunities
4. Disappointed but remaining calm - The UK (10%) and Australia (10%) criticized the tariffs as unfriendly and unhelpful but said they would not retaliate. Both are preparing for possible economic fallout while exploring alternative trade options.
5. Direct countermeasures or defensive policies - Canada (sector specific 10-25%) and South Korea (25%) have already taken concrete steps. Canada introduced a matching 25% auto tariff and has announced support for affected sectors. South Korea rolled out emergency support measures for affected industries.
The varying responses highlight how different countries are balancing their economic exposure to the U.S., combining political pressure and long term trade strategies.
How This Could Play Out
We anticipate short term volatility, retaliation, legal/political challenges, shifting supply chains and inflationary pressures:
- Stock markets have already negatively responded to the news, and businesses are scrambling to assess how the tariffs will hit their supply chains and costs, especially key sectors likely to be disrupted such as autos, tech, agriculture, and retail.
- With Canada already retaliating and the EU hinting the same, we may see a global trade war spiral deeper, inflation and recessionary pressures.
- Trump used emergency powers under the IEEPA to enact these tariffs without Congress. That may face court challenges, including push back from within their own party. Meanwhile, allies are lobbying behind the scenes for exemptions.
- Countries may move quickly to find new trade partners and diversify supply chains. Canada is already accelerating trade talks with Europe and Asia and rolling out support for local exporters.
See: Resources for Canadian Resiliency and Competitiveness
- U.S. businesses and consumers may absorb the tariff costs, not foreign exporters. This could push up prices on many goods (and make it harder for central banks to set interest rates). Canadian sectors like auto parts, energy, and food could feel indirect pressure from global realignments.
Conclusion
The April 2 tariffs are just the start. Countries are reacting in their own ways, and the situation is still developing. Canadian fintechs should prepare for uncertainty, but also for opportunity.
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, 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: www.ncfacanada.org
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Circle Files for IPO as Crypto Firms Eye Wall Street
Initial Public Offering | April 3, 2025
Image: Freepik/rawpixel.com
Circle’s IPO Test Pure Stablecoin Model on Public Markets
The company behind the USDC stablecoin, Circle, has filed to go public on the New York Stock Exchange under the ticker CRCL, looking to raise capital in public markets at a valuation between $7 billion and $12 billion, according to Lex Sokolin’s breakdown.
In 2024, Circle reported $1.66 billion in revenue and $156 million in net income, with details confirmed in its S-1 filing and reviewed by Financial Times. Mostly all of its revenue is earned interest on USDC reserves that is held in safe money market funds managed by BlackRock.
Fortune reports that Circle's IPO is expected to be late April.
Circle Has a Low Risk Model But Rising Costs
This is a low risk, high compliance model which aims to keep all USDC reserves fully backed and avoids higher risk strategies. Its approach has earned credibility with regulators and institutional partners but with lower risks comes tighter margins.
See: Stablecoins Are Growing Faster Than You Think
Last year, Circle paid almost a $1 billion in fees and incentives to distribution partners like Coinbase that help drive adoption. As Sokolin points out in his analysis, these distribution costs are rising fast and now Circle's profitability is under pressure. So despite solid revenue growth, the company is making less profit, not more.
Competitor Tether Is Earning Way More by Taking Risks
These profits were primarily derived from investments in assets like U.S. Treasury bonds, Bitcoin, and gold. This figure places Tether's profitability on par with major financial institutions such as Goldman Sachs. By comparison the revenue gap between Circle and its main rival, Tether (USDT) is wide. Tether generated $13 billion in profit last year by taking on more risk and investing in assets like U.S. Treasury bonds, Bitcoin, and gold.
Pro-Crypto Politics but Trade War Creates Uncertainty
President Trump previously said he wants to make the U.S. “the crypto capital of the planet" and has issued a flurry of pro-crypto executive orders since taking office, such as the U.S. establishing a strategic Bitcoin reserve, and digital asset stockpile. Also, the SEC has slowed down it's regulation by enforcement campaign and is moving to establish a comprehensive framework to regulate stablecoins and digital assets.
So the political environment has opened the IPO window for crypto firms like Circle and crypto exchange Kraken (Payward Inc planning IPO for 2026). However, not all of Trump's policies are benefiting the crypto economy. The broad sweeping universal and country-specific tariffs announced April 2, 2025 for example, of applying import taxes for all goods entering U.S. markets as high as 60% for some countries, have sparked concerns about inflation, trade retaliation, shifting supply chains, and slower global growth, hurting investor confidence.
See: Circle Becomes First Stablecoin to Meet Canadian VRCA Rules
For a company like Circle that depends on interest income for it's revenue, a volatile economic environment poses real risks. Circle has exited its other businesses and is a pure stablecoin operator that is banking on the integrate of its USDC stablecoin into the global financial system and digital commerce markets.
Why It Matters
Since Circle doesn't lend, doesn't diversify, doesn't offer other financial services, it's a pure stablecoin play so it'll be interesting to see how much capital it raises during it's IPO in the current climate. That is, it's a real time case study to see if a low risk, transparent and crypto-native company model can succeed on public markets, especially as it faces rising costs, strong competition, and uncertain global headwinds.
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, 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: www.ncfacanada.org
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