Canadian fintech firms raised $1.62 billion within the first half of 2025, with digital belongings and synthetic intelligence (AI) startups taking the lion’s share of recent funding, in response to KPMG Canada’s Pulse of Fintech report.
Whereas fintech funding slowed globally, Canadian traders maintained regular help for ventures on the intersection of finance and rising know-how. The report singled out firms constructing blockchain-based infrastructure and AI-driven monetary instruments as main progress areas.
“If we take a look at the primary half of 2025, it is clear that digital belongings have re-emerged as a magnet for investor curiosity, regardless of the broader contraction in enterprise funding values,” stated Edith Hitt, a associate at KPMG Canada.
AI investments aren’t shocking, given its monumental enlargement in recent times. Nevertheless, Canadian traders turning to digital belongings funding would possibly catch some off guard, as the danger issue of the crypto market has all the time been up for debate amongst traders.
Nevertheless, with extra pro-crypto laws within the U.S. and additional institutional push legitimizing sure elements of the digital belongings sector, the dialog has clearly began to shift.
“Crypto’s resurgence popping out of 2024 was bolstered by a extra constructive regulatory tone within the U.S., the dismissal of the Coinbase lawsuit, and tangible mainstream adoption in stablecoin use instances,” Hitt added.
Cautious traders
Whereas the $1.6 billion quantity could seem massive, zooming out, the numbers have truly dropped year-over-year as a result of macro occasions comparable to tariffs and better rates of interest. The report stated the primary half of 2025 information is decrease than $2.4 billion invested within the Canadian fintech business in the identical time interval final 12 months, and $7.5 billion invested within the second half of 2024.
This does not imply traders are shying away from fintech funding; slightly, there’s plenty of ‘dry powder’ ready to be deployed, stated Dubie Cunningham, a Companion in KPMG in Canada’s Banking and Capital Markets Apply. Buyers are in search of extra “high quality firms” and urge for food for “maturing mid-to-large stage non-public fairness offers,” she added.
‘Robust’ second half
In reality, KPMG Canada’s report defined that this development of investing in AI and digital belongings is more likely to proceed into the latter half of 2025.
“Investor curiosity in digital will stay robust within the second half of the 12 months and into 2026, pushed by the U.S. administration’s bullish view and lighter regulatory contact on cryptoassets, stated Hitt.
“The main focus shall be on infrastructure, funds rails, and tokenization platforms that may scale in compliant, built-in methods,” she added.
Hitt stated issues will solely warmth up extra on the AI facet, “as extra fintechs more and more undertake and deploy agentic AI options throughout areas like private finance, funding administration, fraud detection and lending.”
