According to Cointelegraph, the Canadian federal government is reportedly gearing up to introduce new regulations for stablecoins, with an announcement potentially coming in the upcoming federal budget. This move suggests that Canada may be following the United States' example after the significant passage of the GENIUS Act. Sources familiar with the discussions revealed that government officials have been in talks with regulators and industry stakeholders for several weeks. The anticipated update on stablecoin regulation could be unveiled as early as November 4, when Finance Minister François-Philippe Champagne is expected to present the federal budget.
Currently, Canada lacks a comprehensive legal framework for stablecoins, although regulators have previously indicated that certain tokens might be classified as securities or derivatives under existing laws. The domestic market for Canadian-dollar-pegged stablecoins remains limited, with QCAD, issued by Toronto-based Stablecorp, being the most notable example. This fiat-collateralized token is backed 1:1 by the Canadian dollar. Meanwhile, US dollar-pegged stablecoins, such as USDC, remain available in Canada, especially after the discontinuation of support for Tether’s USDt in 2023.
The Bank of Canada has been urging the federal government to establish clearer rules for stablecoins to modernize the country's payment system and avoid lagging behind other nations in adopting this technology. Ron Morrow, who oversees payments, supervision, and oversight at the Bank of Canada, stated that governments are moving to regulate stablecoins and other cryptocurrencies to ensure consumers can benefit from them while being protected from credit and liquidity risks.
The United States has made significant strides in stablecoin regulation since U.S. President Donald Trump took office. In June, lawmakers passed the GENIUS Act, which established a regulatory framework for issuing fully collateralized, dollar-backed stablecoins with anti-money laundering safeguards and regular audits. This new legislation is set to take effect in January 2027. Since the passage of the GENIUS Act, there has been increased interest from companies looking to enter the stablecoin market, which continues to expand, with US dollar-pegged stablecoins now exceeding $300 billion in total value.