Cryptocurrency has emerged as a prominent topic in modern finance, sparking both interest and skepticism. Despite its potential to transform the way we exchange currency, many Canadians remain hesitant to embrace it. This hesitation, coupled with shifting global trends and ongoing debates, presents a unique opportunity to explore cryptocurrency through a values lens.
Cryptocurrency in Canada
While awareness of cryptocurrency is growing, its adoption in Canada remains limited. According to the Ontario Securities Commission (OSC), 54% of Canadians know what cryptocurrencies are, yet 79% have never owned them. Common concerns include security, volatility, and a lack of understanding, which deter many Canadians from exploring these digital assets. In fact, only 26% believe cryptocurrencies play a key role in the economy—a sharp decline from 38% in 2022.
For those who do invest, motivations often include speculative opportunities, diversification, or faith in the technology. However, 34% of investors regret their decision, up from 26% in 2022, reflecting the risks associated with this emerging asset class (OSC).
What is Cryptocurrency and how does it work?
Cryptocurrency is a digital form of currency designed to enable transactions directly between individuals without relying on intermediaries like banks or governments. It uses blockchain technology, a secure and transparent digital ledger that records and verifies transactions across a distributed network of computers. These transactions involve digital tokens, such as Bitcoin or Ethereum, which act as the medium of exchange.
Decentralization allows for greater autonomy and reduces reliance on traditional financial systems, offering potential access to those excluded from banking services. By eliminating intermediaries, cryptocurrencies aim to create a system where financial transactions are more accessible, efficient, and resistant to control by centralized authorities.
Cryptocurrency and Kindred Credit Union
At Kindred, we believe that money can be a force for good. The rise of cryptocurrency highlights the need for careful consideration when making financial decisions. On one hand, cryptocurrency presents innovative opportunities for decentralization and financial inclusion by reducing barriers to access. On the other hand, it raises significant concerns, including extreme market volatility, substantial environmental impacts, and potential misuse for unethical purposes.
We strive to make positive impacts with financial inclusion by offering tools and products that empower underserved communities. And while cryptocurrency’s decentralization can create opportunities, it also raises concerns about the lack of oversight, volatility, and ethical use. At Kindred, we ensure that our financial solutions—like our Affordable Housing GICs—are grounded in our core values of integrity, compassion, and stewardship.
These investments provide members with competitive returns while also investing in local affordable housing initiatives, to deliver tangible, community-focused benefits with the integrity and stability that members expect.
As stewards of our members’ financial well-being, we must consider both the opportunities and risks cryptocurrency presents. While decentralization enables broader financial access, it also introduces ethical and practical concerns. Research from Chainalysis found that $24.2 billion in cryptocurrency transactions were linked to illicit activities in a single year, raising questions about security, regulation, and oversight. Similarly, extreme market volatility—such as Bitcoin’s 40% surge following speculation about U.S. crypto policies and the election—underscores the need for thoughtful guidance when evaluating its role in financial plans (CCUA).
Environmental impact is another critical consideration. Mining operations for cryptocurrencies like Bitcoin rely on energy-intensive processes that often draw from non-renewable resources, contributing to greenhouse gas emissions. At Kindred, we assess investments through our socially responsible investment screening process, ensuring alignment with environmental, social, and governance values. This means carefully weighing potential benefits against long-term environmental and community impacts.
Cryptocurrency’s regulatory uncertainties add another layer of complexity, with governments worldwide grappling with questions about taxation, anti-money laundering measures, and consumer protection. The speculative nature of cryptocurrency further complicates its adoption as a functional currency for everyday use.
At Kindred, we see these challenges as an opportunity to provide members with thoughtful, values-driven advice. By aligning financial decisions with both personal and community values, we help members navigate the complexities of innovation without compromising integrity.
As you explore the potential role of cryptocurrency in your financial journey, reach out and speak with a member of our Wealth and Investment team. We can help ensure any decisions are made thoughtfully and responsibly, and are in your best interest. Let us help you Make Peace with Your Money®.
Disclaimer: Please note that Kindred Credit Union does not facilitate access to cryptocurrency markets or support cryptocurrency holdings in member accounts. This blog is intended to provide general insights and should not be considered an endorsement of cryptocurrency investments.
References:
“Crypto Asset Survey 2023.” Ontario Securities Commission (OSC). 29 November 2023.
“Cryptocurrencies.” Emerging digital payment options. Canadian Credit Union Association (CCUA). CI Update: Competitive Intelligence Update. 26 November 2024. 9-12.
“How to Use Blockchain Intelligence to Investigate Crypto Crime.” Chainalysis Team. 9 May 2024. Chainaylsis.