Canadian Crypto Dominance: A Two-Year Streak As Fintech Investments Soar

In Canada, a report from accounting folks at KPMG found that crypto and blockchain got the most investments in the financial tech scene.

On Feb 6, KPMG shared a report about Canadian fintech. The report said that 2023 the number and worth of deals decreased in lot. But guess what? Crypto is still rocking! KPMG found that in 2023, there were 31 deals in the blockchain and crypto world, beating every other part of fintech. The software-as-a-service gang came next with 24 deals, and artificial intelligence plus machine learning had 15 deals.

Statistics on financial technology in Canada for the year 2023. Sourced from KPMG

In the report, Edith Hitt, a partner at KPMG, expressed that investor enthusiasm for fintech projects linked to cryptocurrency was influenced, in part, by the expectation of approvals for spot Bitcoin exchange-traded funds (ETFs) from the United States Securities and Exchange Commission. Hitt clarified:

“The green light for a Bitcoin ETF in the United States may contribute to increased investments in Canadian fintechs and foster the development of innovative technologies within the digital assets sector.”

The boss said that a big deal happened in Canada last year. Some folks put a lot of money into a company that deals with the techie money stuff, especially blockchain. The boss thinks this shows that people in the area are getting more interested in this technology. He also thinks those who put in the money might be looking forward and wondering about a digital currency from the country’s main bank in the future.

Unlocking Crypto Potential: Canadian CBDC & Blockchain

Hitt suggested that implementing a Central Bank Digital Currency (CBDC) in Canada could leverage blockchain technology as its foundational infrastructure, potentially catalyzing growth in the country’s fintech ecosystem.

Despite the prospect of a CBDC, doubts about its acceptance in Canada linger. In August 2023, a Bank of Canada discussion paper highlighted potential challenges in adopting a CBDC, citing a perceived “weak incentive” for consumers who already face no barriers to traditional financial services.

A survey conducted on Nov 30 corroborated the central bank’s concerns. The results revealed that individuals with awareness of CBDCs exhibited greater reluctance to use them than those unfamiliar with the technology.

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The author’s views are for reference only and shall not constitute any investment advice. Please ensure you fully understand and assess the products and associated risks before purchasing.

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