Canada's Stablecoin Act: Who Must Register With the Bank of Canada, Reserve Rules and Timing

Canada's Stablecoin Act was enacted on 26 March 2026, when Bill C-15, the Budget 2025 Implementation Act, No. 1, received Royal Assent. It requires issuers of fiat-backed stablecoins that are not already prudentially regulated financial institutions to apply to the Bank of Canada before offering stablecoins to people in Canada. Issuers must hold reserves at least equal to the stablecoins in circulation, redeem at par and pay no interest. The Department of Finance expects the framework to come into force in 2027, once regulations are made. Issuers will also have to register with FINTRAC as money services businesses dealing in virtual currency.

A stablecoin is a digital token designed to keep a steady value against something else. A fiat-backed stablecoin is pegged to one government currency, such as the Canadian or US dollar. The Act is aimed at that type.

This guide sets out who must register, the reserve and redemption rules, the timetable, and how the new regime sits alongside FINTRAC registration and the Retail Payment Activities Act (RPAA).

Key facts at a glance

Who must register with the Bank of Canada?

The Department of Finance's summary of Canada's stablecoin framework states that issuers of fiat-backed stablecoins that are not financial institutions must apply to the Bank of Canada. The test looks at the market served, not the issuer's home country. Domestic and foreign issuers are both covered if they make stablecoins available to Canadians, directly or indirectly.

"Indirectly" matters. An issuer that never markets in Canada can still be in scope if its stablecoin reaches Canadians through an exchange or wallet provider. Foreign issuers should assess distribution channels, not only their own website.

Prudentially regulated financial institutions are outside the requirement, because they are already supervised for capital and liquidity. This includes federally and provincially regulated banks and credit unions, and foreign prudentially regulated institutions. The framework does not distinguish between Canadian dollar and foreign currency stablecoins: a US dollar stablecoin offered to Canadians is covered in the same way.

The Bank of Canada's stablecoin page describes its role as registering stablecoin issuers, supervising them so that stablecoins are fully backed by high-quality liquid assets and redeemable at par, and taking enforcement action when obligations are not met.

Reserve rules

A reserve is the pool of assets that backs each stablecoin. The framework sets four requirements.

The detail, including which assets qualify, concentration limits and how often reserves are reported and checked, is for the regulations. Issuers should plan for reserve reporting to the Bank of Canada and for independent checks of reserve value.

Redemption rules and the ban on interest

Redemption means a holder handing back a stablecoin and receiving the reference currency. Under the framework:

• redemption must be at par, meaning one stablecoin for one unit of the reference currency
• the issuer must publish a redemption policy and follow it
• the policy must cover timing, the manner of redemption, any fees and the role of any third parties
• issuers cannot offer interest or yield to holders

The Act does not fix a redemption deadline in the summary published by the Department of Finance. That point is likely to be settled in regulations. A redemption policy written now should state a clear timescale that the issuer's banking and custody arrangements can meet on a stressed day, not only an ordinary one.

The interest ban affects product design. Rewards linked to holding a stablecoin should be reviewed against the prohibition before launch.

Timing: what happens between now and 2027

The Department of Finance has said that regulatory development will take 12 to 18 months from early 2026. No exact in-force date has been set. Issuers that want to be ready on day one should prepare during the consultation period rather than after final regulations.

How the Stablecoin Act sits with FINTRAC MSB registration

The Stablecoin Act does not replace anti-money laundering rules. FINTRAC's summary of legislative changes states that stablecoin issuers will be required to register with FINTRAC as money services businesses dealing in virtual currency, from a date to be set by regulation.

Many businesses that handle stablecoins already deal in virtual currency and so already need FINTRAC MSB registration. That includes exchanges and transfer providers serving Canadian customers. What changes is that the issuer itself becomes an MSB, with the five-part compliance programme, client identification, large virtual currency transaction reports for C$10,000 or more, suspicious transaction reports and the travel rule. A foreign issuer with no Canadian place of business registers as a foreign MSB and names a representative for service in Canada.

Enforcement risk is real on this side. FINTRAC's published registry data, updated 16 October 2026, shows that about 76% of the 165 MSB registrations revoked in 2026 belonged to businesses offering virtual currency services. Our guide to revoked or expired FINTRAC registrations explains the causes.

How it sits with the RPAA

The Retail Payment Activities Act already requires payment service providers to register with the Bank of Canada. The Department of Finance states that the stablecoin framework complements the RPAA: the Bank will supervise PSPs that perform payment functions in a fiat-backed stablecoin once that stablecoin is prescribed by regulation.

In practice a stablecoin business may sit in three regimes at once.

RPAA-registered PSPs already file an annual report by 31 March; see our RPAA annual report 2027 guide and our page on Bank of Canada RPAA registration. Trading platforms remain subject to provincial securities regulation, which is outside the scope of this guide.

Enforcement under the Stablecoin Act

The Department of Finance states that the Bank of Canada can address non-compliance through compliance agreements and administrative monetary penalties. The Minister of Finance also holds national security and public interest powers, including refusing access to the framework, prohibiting an issuer from issuing stablecoins to people in Canada, and imposing conditions or undertakings. Penalty amounts will be confirmed as the framework is implemented.

What is still to be settled by regulation

The Act sets the structure. Much of the operating detail will come from regulations, which the Department of Finance is developing with the Bank of Canada's support and will publish in draft in the Canada Gazette for consultation. Firms planning a Canadian launch should track these points in particular.

Until the drafts are published, issuers should build on the points already set and keep their documents flexible enough to absorb the detail. A reserve and redemption design that already meets 1:1 backing, segregation and par redemption will need adjustment rather than redesign.

What issuers should do in the next 12 months

• Map whether the stablecoin reaches Canadians directly or through exchanges and wallets
• Confirm whether the issuer is a prudentially regulated financial institution and so outside the registration requirement
• Document the reserve: assets, custodian, segregation and insolvency protection
• Draft a redemption policy covering timing, method, fees and third parties, and test it against a stress scenario
• Remove any interest or yield feature tied to holding the stablecoin
• Prepare or update FINTRAC MSB registration and the compliance programme for virtual currency activity
• Track the draft regulations when they are published in the Canada Gazette and respond to consultation

Our overview of money services businesses in Canada shows how these registrations combine for a Canadian launch.