Disclaimer: Information found on CryptoreNews is those of writers quoted. It does not represent the opinions of CryptoreNews on whether to sell, buy or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk.
CryptoreNews covers fintech, blockchain and Bitcoin bringing you the latest crypto news and analyses on the future of money.
Canada is set to implement its inaugural comprehensive framework for fiat-backed stablecoins as part of the 2025 federal budget, closely aligning with the regulatory approach adopted by the United States earlier this year.
Key Takeaways:
- Canada will launch its first federal framework for fiat-backed stablecoins under the 2025 budget, following the model established by the US.
- The Bank of Canada plans to allocate $10 million over two years to manage the implementation, recouping expenses from regulated issuers.
- This initiative reflects Ottawa’s commitment to modernizing payment systems as global stablecoin adoption increases.
As stated in Tuesday’s budget announcement, the legislation will mandate stablecoin issuers to hold complete reserves, create transparent redemption policies, and establish strong risk management frameworks, including protections for personal and financial information.
The objective is to enhance confidence in digital payment systems and offer clarity for issuers operating within Canada’s growing cryptocurrency market.
Bank of Canada Allocates $10M to Oversee Stablecoin Rollout
The Bank of Canada is projected to invest $10 million over two years, commencing in the fiscal year 2026–2027, to supervise the rollout.
Annual oversight expenses of approximately $5 million will subsequently be recovered from issuers regulated under the Retail Payment Activities Act.
This initiative follows the recent passage of the US GENIUS Act in July, a significant stablecoin legislation that has intensified global regulatory activity.
Ottawa’s response indicates its determination to modernize payment systems while aligning with international trends.
While the government has not yet detailed when the bill will be presented, the strategy is part of a broader initiative to enhance the speed, affordability, and security of digital transactions for Canada’s 41.7 million citizens.
Coinbase Canada CEO Lucas Matheson expressed support for the proposal, stating to CBC that it could “transform how Canadians engage with money and the internet indefinitely.”
Related Posts
Canada just made a big step forward.
Today’s federal budget includes new guidance on stablecoin regulation, signaling progress toward embracing faster, cheaper, and borderless payments.
With 60,000 advocates strong, Stand with Crypto Canada will continue to be a driving… pic.twitter.com/C0ZiO3GLsR— Stand With Crypto Canada
(@StandWCrypto_CA) November 4, 2025
The global stablecoin market is currently valued at $309.1 billion, with the US Treasury estimating it could reach $2 trillion by 2028.
Institutional adoption is already on the rise, with Western Union, SWIFT, MoneyGram, and Zelle either integrating or planning to integrate stablecoin-based solutions.
Among Canada’s emerging entities is Tetra Digital, which recently secured $10 million from Shopify, Wealthsimple, and the National Bank of Canada to create a Canadian dollar-backed stablecoin.
This initiative follows the Bank of Canada’s decision to pause its central bank digital currency (CBDC) plans in September 2024, citing “no compelling case” to proceed.
Western Union to Launch Dollar-Backed Stablecoin on Solana
Western Union is also entering the stablecoin sector with plans to introduce the US Dollar Payment Token (USDPT) on the Solana blockchain in the first half of 2026.
The token, issued by Anchorage Digital Bank, will enable users to transfer money globally with reduced fees and quicker settlement times, minimizing dependence on traditional banking intermediaries and fluctuating currency conversions.
CEO Devin McGranahan characterized the initiative as a continuation of Western Union’s 175-year mission to simplify money transfers, now utilizing blockchain technology.
He noted that Solana was selected for its speed, scalability, and low-cost transactions, which are essential for the company’s high-volume remittance operations.
By utilizing blockchain infrastructure, Western Union aims to make remittances nearly instantaneous and more transparent.
The post Canada Moves to Regulate Stablecoins in 2025 Federal Budget, Mirroring US Approach appeared first on Cryptonews.
