OTTAWA — It’s official! The Canadian government has officially included the creation of a regulatory framework for stablecoins in its 2025 federal budget. The goal? To ensure security, transparency, and sovereignty in response to the growing influence of the U.S. digital dollar. Here’s everything you need to know.
$10 Million to Regulate Stablecoins and Protect Canadians
According to the newly published 2025 budget, Canada plans to invest $10 million over two years starting in 2026. The funds will support a supervision program managed by the Bank of Canada.
Inspired by the GENIUS Act, this initiative will require stablecoin issuers to:
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Maintain asset reserves equivalent to the value of issued tokens.
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Establish clear redemption policies.
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Protect personal data.
Operating costs—estimated at $5 million per year—will later be covered by regulated companies, making the framework financially self-sustaining.
Beyond enhancing payment systems, the Canadian government’s approach aims to modernize digital payments and reinforce transparency. Over time, it’s also designed to limit the dominance of USD-backed stablecoins within the domestic crypto market.
Toward a “Made-in-Canada” Crypto Regulation
Discussions between the Department of Finance and major crypto industry players—such as Coinbase Canada, Tetra Digital, Shopify, and Wealthsimple—show strong industry support. These companies welcome the move, emphasizing that a clear regulatory framework will foster innovation without compromising security.
Interestingly, the Bank of Canada, which recently shelved its central bank digital currency (CBDC) project, is now favoring public-private collaboration. Under the new approach, Canadian stablecoins could become legal payment instruments, governed by the Retail Payment Activities Act.
Supporting this direction, Tiff Macklem, Governor of the Bank of Canada, stated:
“The current system works well; there’s no need to create a national digital currency.”
Balancing Innovation and Security
While this new regulation could usher in a more stable ecosystem, it doesn’t eliminate systemic risks. Analysts, including those at Chainalysis, warn of past failures such as the collapse of TerraUSD and the hacks of Curve Finance and Euler, all of which exposed the sector’s vulnerabilities.
That’s why Ottawa aims to embed national security standards directly into its framework. The biggest challenge? Balancing consumer protection with global competitiveness.
Currently, the total market capitalization of stablecoins exceeds $290 billion.
With this move, Canada joins the U.S., Europe, and Asia in the race for digital monetary sovereignty. Though pragmatic, its approach clearly marks the country’s return to the global crypto-regulatory stage.
Source: The Block
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