The Canadian government has committed to legislation that will regulate stablecoins backed by its dollar, following the recent footsteps of its U.S. neighbors who passed new laws governing stablecoin issuers over the summer.
With the release of Budget 2025 on Tuesday, the government emphasized its focus on setting clear standards for 1:1 reserves. Administration of this effort will be entrusted to the Bank of Canada.
“This legislation will require issuers to maintain and manage adequate asset reserves, establish redemption policies, implement risk management frameworks, and protect the sensitive and personal information of Canadians,” the budget document stated.
Following the new U.S. law known as the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, the Canadian development received praise from crypto advocates. The Canadian Web3 Council expressed that it is “encouraged by the government’s commitment to enable innovators to issue stablecoins, which will foster competition in Canada’s payments market and reduce transaction costs for consumers and businesses.”
The budget also indicated that amendments to the Retail Payment Activities Act will be necessary. Additionally, it called for “national security safeguards” to ensure the safety of the Canadian financial system.
“Canada has fallen behind the global standard for this innovative technology, and this is an excellent step forward by [Minister of National Revenue] François-Philippe Champagne and [Prime Minister] Mark Carney to increase financial sector innovation,” said Didier Lavallée, CEO of Tetra Digital Group, which positions itself as Canada’s first fully regulated digital asset custodian and financial services provider.
He added that the approach “sends a strong signal that stablecoins need to be regulated as payment instruments and not as securities.”
With this commitment made, attention will now shift toward the implementation phase.
“It’s great to see real progress,” said Eric Richmond, general counsel of Shakepay, in a post on LinkedIn. “Now the focus turns to implementation: making sure the framework stays open, proportional, and accessible, so fintechs can help build the next generation of trusted payment rails for Canadians.”
https://www.coindesk.com/policy/2025/11/05/canada-begins-march-toward-stablecoin-regulations
