From Decrypt · By Jose Antonio Lanz
In brief
Canada's draft stablecoin regulations, published October 24, open a 60-day comment period, with the rules targeted to take effect in fall 2027.
Issuers would hold one-to-one reserves with Canadian custodians, redeem within three business days for no more than a 1% fee, and could not pay interest for holding a coin.
Penalties run up to C$10 million for very serious violations, with the Bank of Canada supervising issuers.
Canada proposed rules on Saturday that would force companies issuing stablecoins—crypto tokens designed to hold a steady value, usually one U.S. dollar—to keep real money behind every coin and hand it back on request. The draft, published in the Canada Gazette, the government's official newspaper, also keeps a ban on paying holders interest, otherwise known as yield.
For anyone who holds these tokens or might send money abroad with them, the rules decide whether you get real cash back if the company behind the coin collapses, how fast it arrives and what it costs.
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Every coin must be backed one-to-one by reserves limited to cash and government debt maturing in three months or less, along with money market funds (pools of short-term safe assets) holding only such assets.
Those reserves must sit with a Canadian custodian in separate accounts that creditors cannot reach if the issuer goes bankrupt. Holders could redeem any amount within three business days, with fees capped at 1%.
Issuers could not pay interest for simply holding a coin, or route it through third parties: any arrangement that lets someone earn yield from holding it, including by sharing the issuer's income, counts as indirect payment. Rewards tied to using a coin, rather than holding it, would stay allowed.
“These prohibitions are intended to distinguish stablecoins from financial products that compete directly with bank deposits or other interest-bearing instruments,” the notice says. Issuers could still keep what their reserves earn, as long as reserves stay at least equal to the coins outstanding.
Issuers also could not present a coin as a bank deposit or claim deposit insurance or a government guarantee, and complaints would need acknowledging within seven days and resolving within 30.
BitcoinBTC · USD$79,970−2.54%Oct 19Oct 21Oct 23Oct 25Oct 26$84.8k$83.1k$81.3k$79.6k24h HighHigh$80,68024h LowLow$79,332VolVol$1.2B→Buy Bitcoin with USDTPowered by JupiterPrice data by CoinGeckoCoinGeckoMore Bitcoin news and projections →The Stablecoin Act became law on March 26, 2026, after Ottawa announced the plan in its November budget. The Bank of Canada will register and supervise issuers.
“There is a pressing need for faster, cheaper, more transparent and more accessible cross-border payments services,” Ron Morrow, the Bank of Canada's executive director of payments, supervision and oversight, said at an Ottawa conference in September 2025.