Canada to Regulate Stablecoins Under 2025 Federal Budget
Canada has unveiled plans to regulate fiat-backed stablecoins as part of its 2025 federal budget, introducing requirements for reserve backing, redemption policies, and risk management frameworks. The Bank of Canada will allocate $10 million to oversee the initiative, with issuers contributing $5 million annually.
The MOVE follows the U.S.'s landmark stablecoin regulations in July and aligns with Canada's broader push to modernize payment systems. The $311 billion stablecoin market, projected to reach $2 trillion by 2028, could see accelerated adoption in digital payments under the new rules.
Regulators aim to protect consumers by ensuring issuers maintain adequate reserves and transparent redemption mechanisms. This development signals Canada's commitment to fostering secure, efficient cross-border transactions while addressing systemic risks in the crypto ecosystem.
