Canada’s government unveiled a plan to regulate stablecoins, requiring fiat-backed issuers to maintain sufficient reserves and adopt robust risk management measures.
Canada is set to introduce legislation regulating fiat-backed stablecoins under its federal budget for 2025, following the footsteps of the US, which passed landmark stablecoin laws in July.
Stablecoin issuers will be required to hold sufficient reserves, establish redemption policies and implement various risk management frameworks, including measures to protect personal and financial data, according to the government’s 2025 budget released on Tuesday.
The Bank of Canada would allocate $10 million over two years, starting in the 2026-2027 fiscal year, to ensure everything runs smoothly, followed by an estimated $5 million in annual costs that will be offset from stablecoin issuers regulated under the Retail Payment Activities Act.
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