--- title: "Canada Proposes Stablecoin Regulations to Bring National Oversight Under Bank of Canada" description: "The Department of Finance unveiled draft rules requiring non-bank stablecoin issuers to register with the central bank and maintain one-to-one reserves." url: https://basisdesk.news/news/canada-proposes-stablecoin-regulations-bank-of-canada published: 2026-10-26T14:26:23.097Z modified: 2026-10-26T14:26:23.097Z section: Regulation & Policy author: Basis Desk Newsroom (AI-generated, source-verified) sentiment: neutral tickers: [USDT] tags: [Canada, Bank of Canada, Stablecoins, Department of Finance, Retail Payment Activities Act, Compliance] license: Quote with attribution to Basis Desk (basisdesk.news). Not financial advice. --- # Canada Proposes Stablecoin Regulations to Bring National Oversight Under Bank of Canada The Department of Finance unveiled draft rules requiring non-bank stablecoin issuers to register with the central bank and maintain one-to-one reserves. ## At a glance - **What happened:** Canada's Department of Finance released draft regulations to enforce the federal Stablecoin Act under Bank of Canada supervision. - **Why it matters:** The framework mandates non-bank issuers maintain one-to-one reserves and places stablecoin payment services under retail payment laws. - **Who is affected:** Domestic and foreign non-bank stablecoin issuers and payment service providers operating in Canada. - **What's next:** Finalization of the regulations and an order by the Governor in Council to bring the Stablecoin Act formally into force. - **Status:** proposed - **Primary source:** [Canada Gazette, Part 1, Volume 160, Number 43: Stablecoin Regulations](https://gazette.gc.ca/rp-pr/p1/2026/2026-10-24/html/reg1-eng.html) — gazette.gc.ca ## Key points - Draft regulations operationalize Canada's Stablecoin Act, requiring non-bank stablecoin issuers to register with the Bank of Canada [1]. - Issuers must maintain at least one-to-one fiat reserves, offer one-to-one redemptions, and submit to national security vetting [1]. - Parallel amendments bring payment service providers handling stablecoins under the Retail Payment Activities Act [1]. ## Editorial remark - **Context:** The Stablecoin Act passed royal assent in March 2026 to resolve gaps in federal oversight, replacing reliance on provincial crypto platform guidelines with statutory central bank supervision. - **Impact:** Non-bank stablecoin issuers and payment processors operating in Canada face direct central bank compliance requirements, mandatory reserves, and supervision fees. - **Watch:** The public consultation period following the Canada Gazette publication ahead of the Governor in Council's order bringing the framework into force. Canada's Department of Finance published proposed Stablecoin Regulations in the Canada Gazette on Oct. 24, 2026, setting the operational framework to bring the federal Stablecoin Act into force [1]. The statutory framework establishes comprehensive federal supervision for stablecoin issuers operating interprovincially or internationally, placing direct oversight under the Bank of Canada [1]. Under the proposed regime, domestic and foreign non-bank stablecoin issuers must register with the Bank of Canada and maintain reserves denominated in the underlying fiat currency backed on at least a one-to-one basis [1]. Issuers must guarantee redemption rights on a one-to-one basis and implement internal frameworks covering corporate governance, risk management, data security, and recovery and resolution [1]. The regime empowers the Minister of Finance to evaluate applicants for national security risks and order the central bank to deny registration [1]. To fund supervision, the central bank will levy application fees and annual assessment fees on regulated entities, supported by an administrative monetary penalties regime for non-compliance [1]. ## Extension to Retail Payment Service Providers The draft regulations also amend the Retail Payment Activities Regulations to bring payment service providers handling stablecoins under the Retail Payment Activities Act [1]. The amendment expands existing supervisory powers to include services involving payment accounts, stablecoin holding, clearing, settlement, and the maintenance of private keys or tokenized payment instruments [1]. Banks, credit unions, trust companies, and prudentially regulated foreign financial institutions remain exempt from the Stablecoin Act's registration requirements [1]. The federal initiative addresses a fragmented domestic structure where stablecoin oversight had primarily fallen to provincial and territorial securities regulators through crypto trading platform restrictions, such as Canadian Securities Administrators Staff Notice 21-333 [1]. With global peers implementing statutory frameworks like the European Union's MiCA and US federal measures, the draft rules establish Canada's first direct federal oversight over stablecoin issuance and processing [1]. At the time of writing, the broader crypto market traded flat, with $USDT holding at $0.9983. ## FAQ **Which entities must register under the Stablecoin Act?** Domestic and foreign non-bank stablecoin issuers conducting interprovincial or international activities in Canada must register with the Bank of Canada. **Are Canadian banks subject to the Stablecoin Act?** No. Prudentially regulated institutions, including banks, credit unions, trust companies, and foreign financial institutions, are exempt from the Stablecoin Act. ## Sources 1. [Canada Gazette, Part 1, Volume 160, Number 43: Stablecoin Regulations](https://gazette.gc.ca/rp-pr/p1/2026/2026-10-24/html/reg1-eng.html) — gazette.gc.ca, 2026-10-24 --- Basis Desk Newsroom · AI-generated, source-verified · https://basisdesk.news/about/how-we-use-ai