As policymakers work to modernize Canada’s payments system as a whole, the country is getting closer to a decision on how to regulate stablecoins.
The Bank of Canada has asked governments to look into setting formal rules for fiat-referenced crypto tokens. This is part of a plan to make transactions cheaper and faster while protecting consumers and the financial system.
The call comes as the central bank starts to oversee payment service providers under a new federal system and as groups in the industry get ready for a long overdue move to real-time payments.
The Retail Payment Activities Act is the main part of the overhaul. It set up a national framework for nonbank payment companies.
Registration started on November 1, 2024, and the main rules for managing risk and protecting customer money went into effect on September 8, 2025.
People who applied before that date can keep doing business while the Bank of Canada finishes its reviews.
This is a temporary measure to keep things running smoothly for both merchants and customers.
Parliament changed the Canadian Payments Act in June 2024 to let more people join Payments Canada.
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This opened the way for supervised payment providers and cooperative credit institutions to use national systems alongside big banks.
Payments Canada then held a public meeting to talk about how to make those changes happen.
The central bank has said that moving to 24 hour instant transfers is a short-term goal. This would put Canada on the same level as the UK and Australia.
Stablecoins are at the centre of these changes. More and more people are using them for trading and sending money across borders. However, Canada does not yet have a single federal rulebook that sets standards for stablecoins’ reserves, audits, or redemptions.
Previous federal consultations examined crypto assets more broadly without landing on detailed requirements for these tokens.
The Bank of Canada has said that closing that gap should be part of the payments agenda. They say that innovation needs to be paired with clear rules.
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A federal survey from September 2021 found that deposit insurance did not cover stablecoins or other crypto assets as of May 2025.
That means that holders have to rely on the issuer’s governance and disclosures, which makes it hard to redeem in an emergency.
That uncertainty would go away if there were a national system that made clear what backs a Canadian stablecoin, how reserves are kept, and when holders can turn their coins into cash.
The federal banking regulator has already said how banks should handle crypto assets for capital and liquidity purposes, which is in line with new international standards.
Financial businesses also have new rules to follow when it comes to anti-money laundering.
Rules that are specific to stablecoins would add another layer by going after token issuers and the systems that keep a coin linked to the Canadian dollar or other currencies.
If Ottawa goes ahead, stablecoin issuers will probably have to do things like get a license, keep their reserves separate, attest to their reserves, and redeem their coins, just like they do in other places.
Payment companies that are already required to register under the Retail Payment Activities Act would have clearer permissions to handle tokenized value in a controlled environment. This could make it easier for more people to use real-time rails in the future.
Users would get more competition and faster money movement, but they would also have clearer options if something went wrong.
The timing will depend on how quickly lawmakers and regulators can bring federal rules in line with provincial rules, which are currently in charge of crypto trading platforms.
