Canada Accelerates Stablecoin Regulations as US Charges Ahead in Crypto Race

North America's stablecoin showdown heats up as regulatory timelines collapse.

The Regulatory Sprint

Canadian policymakers slam the accelerator on digital currency frameworks—watching their southern neighbors build insurmountable momentum. Banking committees work weekends, draft proposals skip usual consultation periods, and parliamentary debates get fast-tracked. The message echoes through Ottawa's corridors: catch up or get left behind.

Border Pressure Cooker

Washington's clear rulebooks attract billions in stablecoin liquidity while Toronto scrambles with temporary measures. Major exchanges publicly favor US operations, citing regulatory certainty. Canadian fintech firms face investor questions about jurisdictional risks—answers aren't coming fast enough.

Finance's Ironic Twist

Traditional banks now lobby for crypto regulations they once opposed—watching payment revenue migrate south. The same institutions that dismissed stablecoins as 'niche' now fear missing the digital dollar revolution. Because nothing motivates financial innovation like watching competitors profit from it.

Global dominoes fall as nations pick sides in the stablecoin standardization war. Canada's accelerated timeline reveals what truly drives financial regulation: fear of irrelevance.

USA’s progress puts pressure on Canada

The United States has already moved ahead with its own rules through the Genius Act. That law gives US regulators direct oversight of stablecoin issuers, including how they manage reserves and follow anti-money-laundering requirements. The clarity has helped strengthen the US as a base for stablecoin businesses.

Some industry voices say Canada needs to MOVE faster or risk losing business to the US. They warn that if the rules remain unclear, investors and capital will migrate to jurisdictions with better-defined policy, reducing activity in Canada’s own financial market.

Analyst concerns

Venture investor John Ruffolo argues that this shift WOULD quietly send Canadian savings into US assets like Treasury bills, since those stablecoins are backed by American government debt. If this happens at scale, it could reduce demand for Canadian bonds and weaken the Bank of Canada’s control over the money supply.

Canadian officials are aware of the risks. RON Morrow, Executive Director of Payments, Supervision and Oversight at Bank of Canada, has said Canada should seriously consider a federal stablecoin framework similar to other countries. Bank of Canada’s former Deputy Governor Carolyn Wilkins has also pushed for action, saying Canada needs rules that protect trust and competition in digital payments.

However, creating a national framework will be complicated. Canada must coordinate between the federal government, the Office of the Superintendent of Financial Institutions (OSFI), and 13 different provincial and territorial securities regulators. This has slowed decision-making compared with the United States.

Also Read: JPC Inc. Launches Japan’s First Yen-Backed Stablecoin