Canada Passes Federal Budget Including Stablecoin Policy
- The Canadian Parliament narrowly passed Prime Minister Mark Carney’s first budget, which includes a stablecoin policy overseen by the Bank of Canada.
- Issuers must maintain one-to-one reserves in high-quality liquid assets and allow immediate redemptions.
- Non-bank stablecoin issuers are prohibited from offering any form of interest or yield on their stablecoins.
- The Bank of Canada will supervise the registry of approved applicants for stablecoin issuance.
- Coinbase Canada CEO Lucas Matheson supports the policy but calls for an interim path for CAD-denominated stablecoins to enter the market.
The new budget represents a significant step towards regulating stablecoins in Canada, aligning with similar U.S. regulations on dollar-backed tokens. The framework aims to ensure consumer protection and financial stability while enhancing Canada’s position in the global cryptocurrency market.
With this budget, Canada’s government is taking concrete steps to regulate stablecoins, requiring issuers to adhere to strict reserve and redemption policies as outlined in the new provisions.
