Canada opens 60-day consultation on stablecoin regulations, plans fall 2027 implementation

On October 24, 2026, Canada released draft stablecoin regulations under the Stablecoin Act, opening a 60-day public consultation ending December 23, 2026. Targeting implementation in fall 2027, the proposed rules mandate that non-financial issuers hold 1:1 liquid reserves with Canadian custodians, redeem tokens within three business days at fees capped at 1%, and refrain from offering interest or yield. Overseen by the Bank of Canada, the framework aligns with U.S. and EU standards to streamline multi-jurisdictional compliance.

Consultation timeline and scope

• ▪Upon full implementation of Canada's proposed stablecoin regulations in fall 2027, non-financial stablecoin issuers must secure registration with the Bank of Canada before issuing tokens
• ▪Under Canada's draft stablecoin regulations released October 24, 2026, Bank of Canada oversight would apply to an estimated five stablecoin issuers and roughly 30 payment companies and crypto platforms
• ▪Canada's draft stablecoin rules, released October 24, 2026 under Canada's Stablecoin Act enacted in March 2026, require non-financial institution issuers to register with the Bank of Canada
• ▪The Canadian government published draft stablecoin regulations on October 24, 2026, opening a 60-day public comment period that runs until December 23, 2026

Reserve and custody requirements

• ▪Stablecoin reserve assets in Canada must be held with a Canadian custodian in bankruptcy-remote accounts that commercial creditors cannot reach
• ▪Canada's draft stablecoin rules released October 24, 2026 require stablecoins to be backed one-to-one by reserves limited to cash, government debt maturing within three months, and qualifying money market funds

Redemption rules and user protections

• ▪Canada's draft stablecoin rules cap redemption fees at a maximum of 1% of the asset's total value
• ▪Canada's proposed stablecoin regulations released October 24, 2026 require stablecoin issuers to process redemption requests within three business days of receiving them from tokenholders
• ▪Under the draft Canadian stablecoin regulations released October 24, 2026, stablecoin issuers must acknowledge user complaints within seven days and resolve them within 30 days

Prohibition on yield and interest

• ▪Canada's proposed stablecoin regulations released October 24, 2026 prohibit non-financial stablecoin issuers from paying interest, yield, or revenue shares to tokenholders, directly or via third parties
• ▪The Canadian yield prohibition in draft stablecoin regulations released October 24, 2026, allows usage-based rewards while banning holding-based interest, aiming to distinguish stablecoins from bank deposits

Prohibitions and penalties

• ▪Canada's proposed stablecoin regulations released October 24, 2026 prohibit stablecoin issuers from presenting tokens as bank deposits or claiming government deposit insurance and guarantees
• ▪Penalties under Canada's proposed stablecoin regulations released October 24, 2026 reach up to C$1 million for serious violations and C$10 million for very serious violations, such as failing to maintain adequate reserves

International alignment and US regulations

• ▪The U.S. GENIUS Act, signed by President Donald Trump on July 18, 2025, also bars stablecoin issuers from paying interest and takes effect in January 2027
• ▪Canada's draft stablecoin regulations released October 24, 2026 align standards with the U.S. GENIUS Act and the European Union's MiCA framework to lower compliance burdens for cross-border issuers