Crypto reigns as Canada’s fintech favorite two years running

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TLDR: Crypto industry tops all Canadian fintech investments 2 years in a row

The blockchain and crypto industry has emerged as the top investment choice in the fintech space in Canada for the second consecutive year, according to a report by accounting organization KPMG. The report revealed that the blockchain and crypto industry had 31 deals in 2023, surpassing other verticals in fintech. This continued interest in crypto-related fintech projects is partly attributed to the anticipation of spot Bitcoin exchange-traded fund (ETF) approvals in the United States. KPMG partner Edith Hitt also noted that one of the biggest fintech investments in Canada in 2023 was in a blockchain infrastructure firm, indicating a growing interest in the technology in the region.

Hitt believes that the potential deployment of a central bank digital currency (CBDC) in Canada could further drive growth in the fintech ecosystem. However, the adoption of CBDCs in Canada still faces doubts, as a Bank of Canada discussion paper found that consumers may not have a strong incentive to use a CBDC due to the absence of barriers to financial services. A survey conducted by the central bank also revealed that people aware of CBDCs were more hesitant to use them than those who were unfamiliar with the technology.

Overall, the report highlights the continued dominance of the crypto industry in Canadian fintech investments and suggests that future developments, such as the approval of a Bitcoin ETF and the potential deployment of a CBDC, could further propel the growth of the sector.

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