Canada’s central bank says stablecoins must be fully redeemable at par, backed by liquid assets like T-bills, with clear, fee-free exit rules. Ottawa plans a federal stablecoin framework in 2025 to support payments modernization.

Canada is moving toward a dedicated federal regime for fiat‑backed stablecoins that would require full, high‑quality reserve backing, at‑par convertibility, and strong oversight by the Bank of Canada. The policy goal is to make stablecoins usable as safe payment instruments while protecting consumers and supporting a broader modernization of Canada’s payments system. According to the Department of Finance’s proposed Canada’s Stablecoin Framework, introduced through Budget 2025 and Bill C‑15, non‑bank issuers of fiat‑backed stablecoins offered to Canadians would have to register with the Bank of Canada, meet prudential and reporting requirements, and be supervised by the central bank. Issuers would be required to maintain a 1:1 reserve of high‑quality liquid assets, in the same reference currency as the stablecoin (for example CAD or USD), held at qualified custodians and segregated from the issuer’s own assets, so that holders have priority over other creditors in an insolvency. They must also establish and adhere to a redemption policy that offers par‑value redemption into the reference fiat currency, along with clear disclosure about timing, process, and any fees, in line with the Bank of Canada’s emphasis on predictable, fee‑transparent exit mechanisms for users. The framework is explicitly positioned as part of Canada’s payments modernization agenda and is designed to complement the Retail Payment Activities Act and other federal and provincial regimes. It focuses on fiat‑backed stablecoins issued by non‑financial institutions, leaving out banks, central banks, and certain closed‑loop or interest‑bearing products, and aims to align with international standards such as the Financial Stability Board’s recommendations on stablecoin regulation. For the federal regime, the Department of Finance expects regulatory development and consultations to run roughly 12–18 months after Royal Assent from early 2026, with the stablecoin framework projected to come into force around 2027, meaning there will be a multi‑year transition from today’s largely unregulated environment to a formal, central‑bank‑supervised regime for stablecoins used in Canadian payments.

✨ AI-generated background, compiled from web sources — not editorial content.

More coverage

• Canada's Stablecoin Act: overview and implications | Insights (torys.com)
• Canada's Stablecoin Framework (canada.ca)
• Canada releases draft framework for stablecoin regulation (osler.com)
• How Canada Can Shape the Future of Stablecoins and Digital ... (cdhowe.org)
• Collaboration on the regulatory agenda - Bank of Canada (bankofcanada.ca)

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