The Canadian federal government is reportedly preparing new rules for stablecoins, and an update could be included in next week’s federal budget, signaling that more countries may follow the United States’ lead after the historic passage of the GENIUS Act.
Citing people familiar with the discussions, Bloomberg reported on Monday that government officials have been meeting with regulators and industry stakeholders for several weeks. The update on stablecoin regulation could be released as early as November 4, when Finance Minister François-Philippe Champagne presents the federal budget.
Canada lacks a comprehensive legal framework for stablecoins, although regulators have previously indicated that certain tokens could qualify as securities or derivatives under existing laws.
The domestic market for stablecoins pegged to the Canadian dollar remains limited. The most notable example is QCAD, issued by Toronto-based Stablecorp, a fiat-collateralized token backed 1:1 by the Canadian dollar.
Stablecoins pegged to the US dollar remain available in Canada, most notably USDC (USDC), following the discontinuation of support for Tether’s USDt (USDT) in 2023.
Related: Coinbase invests in Canadian stablecoin issuer
Catching up with the United States
The developments come as the Bank of Canada has urged the federal government to set clearer rules for stablecoins in order to modernize the country’s payments system, or risk falling behind other nations in adopting the technology.
“Governments are taking steps to regulate stablecoins and other cryptocurrencies so that consumers can reap their benefits and be protected from credit and liquidity risks,” said Ron Morrow, who oversees payments, supervision and surveillance at the Bank of Canada.
The United States has made rapid progress on the stablecoin front since President Donald Trump took office. In June, lawmakers passed the GENIUS Act, which created a regulatory framework for the issuance of fully collateralized, dollar-backed stablecoins with anti-money laundering safeguards and regular audits.
The new legislation will come into force in January 2027.
Since the passage of the GENIUS Act, more companies have shown interest in entering the stablecoin market, which has continued to expand. Stablecoins pegged to the US dollar now exceed $300 billion in total value.
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