Canada Sets Course for Stablecoin Regulation, Following US Lead

Canada will soon implement legislation regulating fiat-backed stablecoins, mirroring the steps taken by the United States. This comes as part of the 2025 federal budget, released on Tuesday, which outlines requirements for issuers to maintain reserves, establish redemption policies, and implement risk management frameworks. The Bank of Canada has allocated $10 million over two years to ensure smooth implementation, while estimated annual costs will be offset by stablecoin issuers regulated under the Retail Payment Activities Act.