Canada Moves to Regulate Stablecoins in New Budget

In its 2025 budget, the Canadian government announced plans to regulate fiat-backed stablecoins, creating a legal framework for their issuance and use. The initiative allocates $10 million over two years for the Bank of Canada to oversee the new regulations, which aim to provide clarity and safety for consumers and businesses. The regulations will require issuers to maintain adequate asset reserves, implement risk management systems, and protect Canadians' sensitive information. With stablecoins accounting for about 30% of global crypto transaction volume, the move positions Canada alongside jurisdictions like the U.S. and the European Union in developing stablecoin regulations. The plans reflect a growing recognition of the need for regulatory oversight in the rapidly evolving digital finance landscape, particularly as stablecoins increasingly impact payment systems. Industry stakeholders have welcomed the announcement, viewing it as a significant step toward modernizing Canada's payment infrastructure and ensuring consumer protection.

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