Canada Unveils Tiered Crypto Custody Framework Focused on Insurance and Audits

Canada has introduced a new tiered crypto custody framework that tightens requirements on how digital assets are held, insured, and audited under CIRO oversight. The policy distinguishes between qualified custodians, in-house arrangements, and third-party providers, raising standards for segregation, legal ownership, and liability. Platforms relying on non-qualified custodians will face stricter capital and reporting obligations, with regulators aiming to strengthen investor protection and reduce counterparty risk exposed by past exchange failures.