The Governor in Council published the proposed Stablecoin Regulations in the Canada Gazette, Part I, Volume 160, Number 43, on 24 October 2026. The notice is dated Ottawa, 9 October 2026, and the sponsoring department is the Department of Finance. This is the pre-publication consultation stage: representations are invited within 60 days after the date of publication of the notice, before the regulations can be made.
The regulations are proposed under section 93 of the Stablecoin Act and paragraphs 101(1)(a), (c) and (p) of the Retail Payment Activities Act. Reserve assets would have to be held in the reference currency with a market value at least equal to the value of outstanding stablecoins at the end of each day, and would be limited to demand deposits including cash, government debt with a remaining maturity of three months or less, reverse repurchase agreements of one business day, and money market funds holding only eligible assets. Reserves could not be pledged as collateral and would have to sit in a segregated account with a qualified custodian incorporated in Canada.
An issuer would register with the Bank of Canada, which would supervise registered issuers, enforce the rules and administer a system of administrative monetary penalties. Holders would gain a right to redemption at one to one in the reference currency within three business days of a request, with redemption fees capped at one per cent of the amount redeemed and at least seven days of notice on the issuer's website before any fee increase takes effect. An issuer could not pay interest or yield tied to holding a stablecoin, or enter arrangements that encourage holding through yield, while rewards tied only to using a stablecoin would remain permitted.
The Minister of Finance may review an applicant for national security risk, with an initial 60 day decision period and a 180 day review period, both of which may be extended. An issuer already in operation must file its application within 30 days of the Stablecoin Act coming into force to rely on the transitional measures. Representations on the draft close 60 days after 24 October 2026, and the regulations are intended to come into force in the autumn of 2027.
Licentium advises stablecoin issuers, custodians and payment service providers on authorisation, reserve structuring and cross border supervisory obligations in Canada, the United States, the United Kingdom and the European Union. Work we undertake includes drafting consultation responses to the Canada Gazette notice, testing proposed reserve and custody arrangements against the draft regulations, and preparing Bank of Canada registration applications.
Source: Canada Gazette, Part I, Volume 160, Number 43: Stablecoin Regulations, 24 October 2026