Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Category Archives: Leadership, Competition, Human Capital, Health
Canada Risks Falling Behind as UK Lands AI Megadeals
AI Infrastructure | Sep 17, 2025
Image: Freepik
Billions Flow Into UK AI via US Tech Deals, While Canada Relies On Domestic Investment
On 16 September 2025, the UK US Tech Prosperity Deal was announced at £31 billion, coinciding with President Donald Trump’s state visit where the UK rolled out a royal reception, and the leaders framed the partnership as a new era in digital and industrial cooperation. The deal involves unprecedented commitments from American tech giants:
- Microsoft pledged $30 billion USD (~£22 billion) for UK AI infrastructure, its largest investment outside the United States, which includes £15 billion (~$19 billion USD) for new data centres and Britain’s largest planned supercomputer in Essex. CEO Satya Nadella Microsoft CEO described the partnership by saying, “Our commitment to that partnership is stronger than ever.”
See: SEC Chair Backs Crypto Super Apps and AI Finance at OECD
- Nvidia announced a £500 million (~$650 million USD) equity investment in UK firm NScale and a broader £11 billion (~$14–15 billion USD) package, including 120,000 GPUs, with 70% allocated to computing and networking and 30% to land, power, and data centre structures. Jensen Huang declared, “This is the week that I declare the UK will be an AI superpower.”
- Google committed £5 billion (~$6.7 billion USD) to research and infrastructure, while OpenAI joined Nvidia, Arm, and Nscale to launch Stargate UK in Northumberland, a project expected to generate 5,000 jobs
- CoreWeave pledged £1.5 billion (~$2 billion USD) to boost national compute capacity
Why the UK Attracted Foreign AI Investment
The UK positioned AI as a national mission. On 9 September 2025, ministers reported that UK AI firms had already attracted £2.9 billion (~$3.9 billion USD) in investment over the prior year, signalling momentum ahead of Trump's state visit.
Government officials emphasized sovereign compute, ensuring that the infrastructure to train and deploy frontier AI models exists domestically. They linked the deal to broader reforms including streamlined planning approvals for data centres, accelerated clean energy delivery, and the designation of new AI Growth Zones in regions such as Northumberland.
See: Canada’s Opportunity In Efficient Reasoning AI
Taken together, the policy mix signalled to global investors that Britain was serious about matching research excellence with infrastructure capacity, backed by visible political commitment.
Incentives and Concessions in the Tech Prosperity Deal
The government stressed that the agreement did not include scrapping the 2% Digital Services Tax, which generates £800 million (~$1.1 billion USD) annually, and did not provide blanket copyright concessions.
Others noted that the broader UK-US discussions included trade measures beyond AI. For example, analysis highlighted a quota allowing 100,000 UK cars into the United States annually at a reduced 10% tariff.
While not officially part of the AI deal, the above measures reinforced the perception that Britain was tying technology, industry, and trade policy together in a comprehensive partnership.
Canada’s Position and Domestic Investments
Canada continues to lead in AI research through world class institutes in Toronto, Montreal, and Edmonton. The federal Pan-Canadian AI Strategy was renewed in 2024 with $2 billion CAD (≈£1.2 billion, ~$1.5 billion USD) to strengthen science and commercialization.
Domestic players are also committing significant sums. Telus pledged more than C$70 billion (~£41 billion, ~$52 billion USD) over several years to expand data centres and digital infrastructure. It's a plus but Canada has not attracted comparable foreign megadeals in AI infrastructure.
Structural challenges include slower permitting processes, uncertainty in clean energy delivery for high requirement data centres, and the absence of high profile government 'priming the pump' signalling openness to international megadeals.
See: Brookfield Invests €20 billion in France’s AI Infrastructure
Another barrier is geographic location. U.S. hyperscalers can serve Canadian markets directly from data centres located just across the border, avoiding regulatory delays and high Canadian energy costs. This weakens Canada’s case for domestic megadeals, as firms see little urgency to build new infrastructure within Canada if American facilities can already reach Canadian customers efficiently.
NCFA has cautioned that without pairing research excellence with infrastructure investment and supportive policy, Canada risks eroding its leadership.
Why This Divergence Matters
The UK secured global AI megadeals by aligning industrial policy, trade leverage, and regional development with diplomatic visibility. This multi-pronged approach reassured US tech giants that their investments would be politically and commercially supported. Canada needs to translate research prestige into large scale international infrastructure commitments and risks losing ground in the AI race unless it combines science with infrastructure and policy.
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 aa 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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CMA Lessons on Competition and Growth for Canada
Competition | Sep 15, 2025
Image: Freepik/rawpixel.com
UK CMA Speech Confirms That Competition Drives Investment and Scale-ups
On September 15, 2025, Sarah Cardell, Chief Executive of the UK Competition and Markets Authority (CMA), delivered a speech at the BVCA Summit outlining how competition policy can drive investment and scale-ups. This article summarizes the CMA’s takeaways, benchmarks them against Canada’s position, and explores what lessons fintech leaders and policymakers should draw on.
Four Takeaways from Cardell's Speech
1. Pace and Reducing Delays to Boost Investment
The CMA stressed that long regulatory delays deter investors and can cause promising startups to fail before securing capital. To address this, the CMA introduced new performance indicators to shorten merger review timelines and committed to streamlining processes across its work.
See: Insights from the UK’s Pro-Innovation Regulation Review
“Delay chills investment and can mean promising startups run out of road.”
2. Proportionality and Reducing Burdens
Excessive or outdated regulation can create costs and risks that stifle investment and innovation. The CMA promises to act proportionately, weighing costs and benefits carefully, phasing out outdated remedies, and focusing on the issues most relevant to consumers and businesses.
“We will act proportionately and minimise costs wherever we can.”
3. Predictability and Reducing Uncertainty
Uncertainty in regulatory outcomes undermines investor confidence. The CMA is introducing clearer jurisdictional guidance for merger reviews and publishing detailed roadmaps under its new digital markets regime to provide businesses with greater certainty.
“Uncertainty can stall decision-making and weaken business and investor confidence.”
4. Process and Engaging Stakeholders
The CMA emphasized the importance of open and direct engagement with stakeholders. It is creating new forums such as the Growth and Investment Council and deploying stakeholder surveys to improve how its policies reflect commercial realities.
See: UK to Cut Regulatory Red Tape to Boost Tech and Growth
“The CMA is more committed than ever to the fundamentals of our role – to promote competition and protect consumers, within an independent regime.”
Canada’s Scorecard Against the CMA Takeaways
Measured against the CMA’s framework, below we try to rank how Canada performs for fintech competitiveness and investment.
Pace (2.5/5)
We can look at the past for data-driven proof that Canadian fintechs face chronic delays that slow capital raising and partnerships. Open banking has missed multiple government deadlines, leaving fintechs and banks without full clarity of the program.
Another example is around payment modernization, particularly the Real Time Rail (RTR) which has also faced repeated setbacks, stalling innovation in faster payments. Let's not forget the creation and rollout of equity crowdfunding rules that took years to harmonize nationally under NI 45-110, meaning startups endured fragmented frameworks for far too long. In an era where global regulators must keep pace with innovation, Canada's slower regulatory pace is a drag on growth.
Proportionality (2/5)
Overlapping and duplicative rules increase compliance costs disproportionately for startups. Equity crowdfunding portals are a good example. Under National Instrument 45-110, portals must register as restricted dealers, maintain minimum working capital, and comply with know-your-client and suitability requirements similar to investment dealers, even though transaction sizes are capped at $1.5 million per year.
See: Canada’s Public Sector Costs and Productivity Gap
These requirements add legal, audit, and technology costs that are heavy for small portals but don't always provide proportionate consumer protection benefits, since investment limits already restrict retail investor exposure. The result is fewer viable portals, reduced competition, and higher costs for startups seeking to raise capital. Payments firms navigating multiple oversight bodies face similar burdens. Competition Act amendments have broadened investigative powers, but without a clear proportionality test for smaller firms. This creates uncertainty and often deters new entrants.
Predictability (2/5)
Canada has stalled on open banking and been inconsistent on payments modernization, leaving both fintechs and banks unsure about what rules to plan around. Licensing and regulatory approaches often lack clear roadmaps, meaning firms cannot anticipate timelines or likely outcomes. This erodes investor confidence at exactly the point when fintechs need greater visibility and confidence support. By contrast, the CMA now publishes roadmaps and consults on jurisdictional thresholds in advance.
Process (2.5/5)
Regulators in Canada conduct consultations but feedback loops can be slow and often opaque, discouraging stakeholders from participating. It reminds of a Stephen King quote, "Fool me once, shame on you. Fool me twice, shame on me. Fool me three times, shame on both of us." Stakeholders rarely see how their input affects outcomes.
See: New Zealand’s Regulatory Approach Offers Lessons for Canada
In fintech licensing and payments reform, firms report long periods of silence, creating uncertainty and wasted preparation costs. Engagement exists but is not structured to produce rapid clarity. The CMA, by contrast, has set up a Growth and Investment Council and targeted outreach to startups, making process improvements measurable and visible.
Outcomes and Accountability
What further distinguishes the CMA approach is its focus on measurable outcomes. Timelines, KPIs, and stakeholder feedback are built directly into its reform process. In Canada, regulators rarely hold themselves to outcome metrics. Open banking, payments modernization, and fintech licensing all lack clear outcome based benchmarks for success with transparent reporting, leaving startups and investors facing prolonged uncertainty.
Government Procurement as a Fintech Growth Escalator
Cardell highlighted procurement as a powerful lever for scaling firms. In the UK, public procurement represents £385 billion annually. Used strategically, it can help innovative firms scale into global leaders.
Canada’s Phoenix pay system failure illustrates what happens when procurement excludes startups and fintechs. Instead of relying solely on a single legacy vendor, the government could have piloted payroll fintechs and scaled those that proved reliable. This approach would have reduced project risk, avoided billions in overruns, and nurtured homegrown fintechs with export potential. The Phoenix example demonstrates why procurement should be used to actively build capacity for Canadian innovators, which can be accomplished in several ways.
See: Innovative Approaches to Smarter Regulation
Demand Generation
Government is the largest single purchaser in the economy, and directing even a fraction of that demand toward fintech solutions can create the credibility these firms need to raise capital and expand. For example, the government could launch vendor challenges for small business lending platforms or digital payment systems for rebates, benefits, and tax refunds. Winning firms would gain real contracts that prove their technology works and make it easier to raise more investment. This type of procurement not only meets government requirements but helps Canadian fintechs grow at home and compete abroad.
Scaling Escalator
Too often, fintechs win small pilots but never graduate to meaningful contracts. A staged model, where early pilots can transition into scaled adoption if they meet performance benchmarks, would help promising firms grow into national providers. This escalator effect is critical in financial technology, where credibility with one large client can unlock commercial opportunities globally.
Regulatory Bridge and Clarity
Fintechs often face a Catch-22 where they can't win major contracts without clear regulatory status, yet regulators hesitate to provide clarity until the firm has proven market traction. Procurement could break this cycle by acting as a regulatory bridge. If a fintech wins a vendor challenge for services such as digital identity or payments, the process could be designed to include early regulatory sign-off or tailored supervisory guidance. This would give the fintech and its backers confidence about compliance costs and expectations, while also reassuring the public that safeguards are in place from the start.
See: Overcoming Barriers to Growth in Financial Regulation
Taken together, the above examples could use government procurement as a genuine scale-up escalator. So instead of simply selecting incumbents all the time and concentrate risks into a handful of providers that turn into an oligopoly, government purchasing could become a purposeful tool for nurturing Canadian fintechs into globally competitive firms.
Lessons and Recommendations
The CMA’s speech discusses competition as a tool for unlocking growth. For Canada’s fintech sector, three lessons stand out.
- Approvals must be streamlined so fintechs can access capital and scale without delays.
- Oversight should be applied proportionately so startups retain resources for innovation rather than compliance.
- Procurement should be used strategically to build scale up pathways through real contracts that strengthen fintechs at home and abroad.
If Canada embraced the UK's stance on competition and scale-ups, fintechs would move faster from idea to scale, investors would back firms with greater confidence, and procurement would foster globally competitive players.
Competition shouldn't be seen as a hand-brake but rather as the engine for Canadian productivity and growth.
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 aa 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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S&P Blocks Strategy’s Inclusion Sending Message to Boards
Crypto | Sep 16, 2025
Image: Freepik/drobotdean
S&P’s Rejection Shows Bitcoin Treasuries Face Barriers to Index Entry (and Automatic Passive Flows)
As reported by MarketWatch, the S&P Dow Jones Indices announced its quarterly rebalance and chose not to add Strategy Inc. (formerly, MicroStrategy) to the S&P 500.
Strategy Inc is the largest corporate holder of bitcoin with more than 630,000 BTC, equal to over 3% of the total supply, and met all the published criteria on market capitalization, liquidity, and profitability, but was essentially excluded by the powers of committee discretion. JPMorgan analysts said this exclusion is a warning shot to company boards that bitcoin heavy treasuries may face barriers to benchmark inclusion, limiting access to the large automatic flows of index tracking funds.
See: GameStop Joins Growing List of Bitcoin Treasury Holders
In response, Strategy’s executive chair Michael Saylor posted an image showing that its shares have outperformed the S&P 500 and Bitcoin with the caption “Thinking about the S&P right now ….” He also told Barron’s, “Every quarter, we make new believers. I think that will continue for the foreseeable future.”
Thinking about the S&P right now… pic.twitter.com/Y5nPc9XT4l
— Michael Saylor (@saylor) September 6, 2025
Exclusion from the S&P Raises the Cost of Capital
The S&P 500 is the most tracked equity index in the world. Entry usually lowers a company’s funding costs while expanding its investor base. Trillions of dollars are passively allocated to its members. While the methodology spells out eligibility rules, the committee reserves the right to apply judgment.
Inclusion in the S&P 500 forces trillions of dollars of index tracking funds to buy a company’s stock, creating large automatic inflows that lower funding costs and deepen liquidity. Exclusion means those compulsory passive flows never materialize.
See: Strategy Buys More BTC as Canadian Crypto ETFs Grow
Strategy built its bitcoin position through repeated equity offerings, which turned its stock into a leveraged proxy for bitcoin. That model is now constrained. At the same time, Nasdaq (where Strategy MSTR is currently listed) requires shareholder approval for certain crypto related financing steps, which increases governance complexity and slows decision making.
Together these barriers raise the cost and difficulty of growing corporate bitcoin reserves through treasury strategies. Boards now face a choice of maintaining a bitcoin identity with limited access to mainstream capital markets, or rebalance treasury policies to preserve index eligibility and liquidity.
Some Companies May Prefer Bitcoin ETF Exposure
Some investors may prefer exposure through ETFs rather than dealing with dilution or volatility inside an operating company. Equity research coverage and institutional ownership might reduce if analysts see a company as primarily a bitcoin vehicle rather than an operating business.
Exchange traded funds present a clear alternative. Canada approved spot bitcoin ETFs in 2021 and the United States followed in 2024. ETFs hold bitcoin directly in custody and issue units that trade on exchanges, offering regulated and liquid exposure. ETF fees are typically between 0.2% and 1.0%, relatively modest compared to the governance and financing costs of treasury strategies.
See: Trump Media and Crypto.com Launch Cronos Treasury Firm
However, corporate treasuries allow boards to control timing and scale, use equity issuance to accelerate exposure, and attract investors who prefer equity proxies for bitcoin. Yet these benefits are balanced by costs that now include index exclusion, shareholder approval requirements, and stock valuations that swing with bitcoin more than business fundamentals.
The early regulatory approval of spot bitcoin ETFs in Canada gave investors a first mover's advantage, and a clear and credible option for digital asset exposure at a time when corporate treasuries were still the main vehicle in other markets.
Since then, Canadian companies including miners and digital asset firms such as Hut 8 and BIGG Digital Assets have also pursued bitcoin treasury strategies. This means Canada now has both treasuries and ETFs operating side by side, and it is expected that additional pathways to digital asset investments will emerge over time as regulations evolve.
Outlook
The S&P committee will meet again this December to review index composition. That update could determine whether Strategy’s exclusion is temporary or a longer standing policy. Regardless of the outcome, the September rejection may already be impacting board room decisions affecting the balance between treasury exposure versus ETFs. ETFs offer a regulator approved and stable pathway for investor demand, while treasuries provide control and branding but now carry higher financing and governance costs.
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 aa 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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Agentic AI in Banking From Pilots to Real Impact
AI Research Report | Sep 15, 2025
Image: Banking Use of Agentic AI (Figue 1, MIT Insights Survey 2025)
70% of Bankers are Using Agentic AI and Only Those With Governance, Trust, and Skills Will Win
A recent MIT Technology Review Insights survey of 250 global banking executives found that 70% of banks already use agentic AI, with 16% running live deployments and 52% in pilots. For Canadian financial institutions and fintechs, the race is on with global competitors embedding AI solutions into compliance, fraud prevention, and customer service at scale.
Banks Turn to Agentic AI for Fraud Detection and Security
Fraud detection and IT security are setting the pace. More than half of executives report that agentic AI is already highly capable in fraud detection (56%) and security (51%), with efficiency gains and customer experience improvements each cited by 41%. These use cases are significant because fraud losses are rising and regulators are upping their game on cyber resilience.
See: RBC and Cohere Partner on ‘North for Banking’ AI Platform
Practical applications include mortgage underwriting, small business lending, collections, dispute resolution, and know-your-customer KYC compliance. By using agentic agents together with expert human oversight, banks are compressing decision times from weeks to days and freeing time for employees to focus on higher value work.
As HSBC’s Ian Glasner puts it, “Think of agentic AI as like an intern helping you get all of the more simplistic tasks done, but the human is still there to oversee and take the final decision.”
Governance, Skills, and Data Remain Adoption Hurdles
Image: MIT Insights Banking Survey 2025 (Figure 6 Challenges, Agentic AI)
The survey also suggests that adoption challenges are growing, top three barriers include: 1. Governance, risk, and compliance (63%), 2. Shortage of technology skills (58%), and 3. Poor data quality and integration (54%).
To overcome, Canadian banks and fintechs should focus on resolving weak data linkages across silos and the shortage of AI ready talent needed to scale responsibly.
See: Retail Banking Platforms and VC Trends 2025
Trust compounds the issue. An EY study found that only 42% of consumers trust financial institutions to manage AI in their best interest, while 30% say they do not trust them at all. That leaves a net trust level of just 12%. In Canada, regulators are focused on consumer protection, and fintechs that build trust into their AI systems could gain an edge.
How DBS and HSBC Set Benchmarks for Agentic AI Governance
Leading institutions are building playbooks worth watching. DBS Bank in Singapore applies its PURE framework (Purposeful, unsurprising, respectful, and easy) to explain all customer facing AI systems. If performance metrics breach preset limits, a kill switch halts the system in real time. As DBS’s Nimish Panchmatia warns, “Agentic AI is a continuous journey. If done properly, there’s significant value at the end of it. But you have to persevere.”
HSBC maintains a detailed inventory of AI systems tied to business owners, risk classifications, and model documentation to create a governance baseline across 200,000 employees in more than 50 markets.
See: H1 2025 Global Fintech Funding Slows, Some Sectors Firing
For Canadian banks and fintechs, these approaches show the value of aligning governance and technical innovation before scaling widely.
Outlook
Banks in Asia, Europe, and the U.S. are experimenting with AI at pace, and many are moving from pilots to enterprise adoption. For Canada, efficiency and risk controls are only part of the story. The real differentiator will be who earns the confidence of consumers while scaling responsibly. Agile fintechs can seize this opening. Unlike large banks weighed down by legacy systems and regulatory complexity, fintechs can design AI solutions that are transparent, accountable, and 'trust first' from the start.
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 aa 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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SEC Chair Backs Crypto Super Apps and AI Finance at OECD
Regulation | Sep 15, 2025
Image: Paul Atkins, SEC Chair
Atkins’ Paris Speech Puts Crypto Super Apps and AI Finance At the Heart of U.S. Capital Markets
On September 10, 2025, SEC Chair Paul S. Atkins delivered a keynote address in Paris at the OECD Roundtable on Global Financial Markets, resetting the tone for U.S. capital markets. His speech positioned the SEC not as an adversary to entrepreneurs but as an enabler of growth, advancing Project Crypto, a broad modernization initiative aimed at bringing securities regulation into the blockchain era.
Paul S. Atkins, SEC Chair:
“It is a new day at the SEC. Policy will no longer be set by ad hoc enforcement actions. We will provide clear, predictable rules of the road so that innovators can thrive in the United States.”
SEC Project Crypto Backs U.S. Crypto Super Apps
One of the most significant parts of Atkins' remarks was his (the SEC's) endorsement of “super-app” platforms. This vision is a welcomed 180 after years of a type of regulate by enforcement approach that drove many U.S. crypto companies overseas.
See: Made in China Trump Mobile Is a Fintech Bundling Play
For fintechs, it means a future where integrated platforms can grow under clear oversight, with investors able to choose from multiple custody models.
For Canadian innovators and regulators, it further raises urgent questions about how Canada will remain competitive if the U.S. creates a friendlier landscape for capital formation and digital asset services.
“We must allow for ‘super-app’ trading platform innovation that increases choice for market participants. Platforms should be able to offer trading, lending, and staking under a single regulatory umbrella.”
Competing with MiCA and Global Frameworks
Atkins acknowledged that Europe has already moved ahead with the Markets in Crypto Assets regulation, praising the framework as a first attempt at comprehensive digital asset oversight while stressing that the U.S. will not fall behind. By declaring that America must be “second to none” in fostering innovation, he more or less confirmed that the competitive race was on.
See: SEC and CFTC Open Door to Spot Crypto Trading
For Canadian fintechs, this accelerates the competition challenge with Europe and the U.S. both moving towards clarity, while Canada’s rules remain relatively limited. This moment calls for proportionate approaches to policy that reduce friction for innovators while protecting investors, as highlighted in NCFA’s Canadian Banks and Fintechs Back Regulated Stablecoin post.
AI Finance and Agentic Markets
Beyond crypto, Atkins described the changes coming in the era of “agentic finance” where autonomous AI agents execute trades, allocate capital, and manage risk with compliance built directly into their code.
Coupled with blockchain, he argued, AI could democratize access to advanced strategies and lower costs for individuals.
The challenge for regulators is to install commonsense guardrails without overreacting.
Fintech builders heard that AI in finance is not only here to stay but will be supported if developed responsibly.
Closing Thoughts
Atkins’ Paris keynote can be taken as a statement of intent. He placed crypto super apps, AI finance, and tokenized markets front and center of U.S. strategy. Fintechs and investors have immediate takeaways. That is regulatory clarity is coming, and the players and markets that adapt quickly will benefit most.
See: UK Publishes Draft Rules for Crypto Regulation
As U.S. and Europe continue to advance crypto regulatory frameworks, it's more critical than ever that Canada expeditiously create proportionate regulation, double down on enabling frameworks, and collaborate with global peers. Canada would benefit from positioning itself as a jurisdiction that rewards responsible experimentation. As Atkins put it, “crypto’s time has come.”
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 aa 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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Canada’s Opportunity In Efficient Reasoning AI
AI Innovation | Sep 12, 2025
Image: Freepik/DC Studio
Smaller and More Efficient Reasoning Models Could be Canada’s Innovation Edge
As reported by Venture Beat, Microsoft Research has released rStar2-Agent framework, a new training model approach that demonstrates how smaller models can deliver reasoning logic and performance once reserved for massive frontier models, but doesn't require massive systems or costs. While reinforcement learning in agentic AI isn't new, Microsoft's model adds important innovations in how it carefully verifies each step with fewer resources.
A 14 billion parameter model deliver results on math and science benchmarks that matched or even outperformed much larger 600-billion-parameter systems. Astonishingly, Microsoft's own tech report explains that that rStar2-Agent, “reached state-of-the-art results in under a week of training, surpassing a 671B-parameter system despite being just 14B in size.”
See: Small Language Models Prioritize Privacy and Efficiency
This scale difference is significant. Frontier models often need entire data centres while rStar2-Agent can be quickly trained and deployed on just a few high-end servers. For businesses and regulators in Canada, the impact could mean opening up access to this type of hyper efficient reasoning AI at a fraction of the cost, making it practical for fintech startups, universities, and financial institutions to adopt.
Canada's AI Innovation Opportunity
Competing head-to-head against giant foundation models isn't realistic for most Canadian firms or government programs. Efficient reasoning models, which can operate with constrained compute while still producing transparent and auditable steps, align directly with Canadian strengths, and is a pathway that Canadian innovators are well positioned to take on.
Canadian fintechs and startups can prioritize smarter training methods with domain specific fine tuning rather than trying to match the infrastructure scale of global hyperscalers. Smaller reasoning models also lower the barrier for enterprises that want to use AI in production but can't justify the heavy infrastructure investments of the largest and latest models.
See: CEO Exits as GitHub Absorbed into Microsoft’s CoreAI
As Microsoft describes it:
"[rStar2-Agent] demonstrates advanced cognitive behaviors, such as thinking carefully before using Python coding tools and reflecting on code execution feedback to autonomously explore, verify, and refine intermediate steps in complex problem-solving.”
The Canadian regulatory environment makes verified reasoning especially valuable. Models that validate their steps provide transparency and compliance support, which are essential in sectors like finance. This type of approach matches Canada’s push for trust, accountability, and explainability in AI.
Innovation, not size, could define Canada's leadership in AI. National strategies that support funding, research, and pilot programs for efficient reasoning AI could accelerate adoption across regulated industries. Fintech and financial institutions are natural leaders in this space because they already require digital public infrastructure that balances efficiency and inclusion.
Read: UK-Google Deal Raises DPI Red Flags for Canada
The opportunity also extends beyond finance. Healthcare systems could use efficient reasoning AI for diagnostics where transparency is vital. Universities and research labs could run experiments on smaller models without prohibitive costs, fostering local innovation.
Outlook
Canada has the opportunity to turn its limitations into a competitive edge by becoming a global hub for efficient reasoning AI that is affordable, reliable, exportable expertise, and aligned with priorities in finance, governance, and inclusion.
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 aa 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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Latest Fintech IPOs Figure Debut and Lendbuzz Filing
Financing | Sep 12, 2025
Image: Freepik
Blockchain Lending and AI Auto Finance Move Into Public Markets
More Fintech IPO activity is back on the radar as the market window reopens after a quiet stretch. NCFA has already highlighted IPO ambitions from companies like Circle, eToro, Klarna, and Gemini in our post on 10 Fintech and Crypto IPOs 2025 Boom or Bubble. This week offers two new developments as Figure (FIGR) completed its Nasdaq debut yesterday, and Lendbuzz (LBZZ) files for IPO for artificial intelligence in finance.
Figure Technology Solutions IPO
On September 11, Figure Technology Solutions IPO raised US$787.5 million by selling 31.5 million shares at US$25 each. The stock opened at US$44 and closed at US$31.11, a 24% gain over the offering price.
Pricing came in above the increased range of US$20–22 with strong investor demand. FIGR is currently trading at US$7.34B
Founded in 2018, Figure built its model on the Provenance blockchain to originate and manage loans. It started with home equity lines of credit (HELOCs) and has expanded into personal loans, student refinancing, and digital asset markets. Their ambition is to transform how financial products are issued and traded by using blockchain settlement infrastructure.
See: Revolut Pushes into Commercial Real Estate Lending
For investors, the Figure debut shows that blockchain-enabled lending platforms can attract significant public market support. The strong first day debut performance, pricing above the raised range, and a revenue model that combines lending with fee-based infrastructure indicates that markets are open and positive on scalaling blockchain finance.
Comparable Canadian firms might include Ledn, Nesto, Mogo, Pine or Perch. Global peers include SoFi, UpStart, or Rocket Mortgage.
Lendbuzz Files for IPO for AI Auto Finance
On September 12, Lendbuzz filed for a US IPO with a filing that showed 38% revenue growth to US$172.9 million in the first half of 2025 compared with US$125.4 million the year before. Net income rose to US$11.1 million from US$5.6 million, showing a fintech with scale and profitability. Comparable Canadian players include Canada Drives or Clutch.
The company has originated more than US$4B in loans and is backed by Goldman Sachs and MUFG. It has strengthened its funding base through securitizations, including a US$266M transaction in July 2025 and more than US$2.1B of completed asset-backed transactions to date.
See: CSA Expands LIFE Exemption to Boost Public Capital Raising
Lendbuzz's filing scope shows how artificial intelligence can unlock new credit markets. By underwriting auto loans for borrowers with little or no credit history, the company is targeting underserved but financially active consumers. It will be interesting to track how its AI models manage risk as loan volumes grow over time.
Outlook
These IPOs show how blockchain lending and AI powered finance niches like auto are moving into public markets with credible scale. Canadian fintechs need to keep in mind that global markets are rewarding fintechs that address inefficiencies in credit and capital markets, useful benchmarks for innovators preparing for their own future public listings.
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