Canada is edging closer to formal stablecoin regulation, and the Bank of Canada is making it clear it wants strong guardrails in place.
Speaking Tuesday, Governor Tiff Macklem said any stablecoin allowed to operate in Canada must function like real money, not a speculative crypto asset with loose promises attached. If stablecoins are going to be used for payments, he argued, they need to be dependable, boring, and fully trustworthy.
“We want stablecoins to be good money, like bank notes or money on deposit at banks,” Macklem said, stressing that reliability matters more than innovation hype.
To meet that standard, he outlined two non-negotiable requirements. Stablecoins must be pegged one-to-one with a central bank currency and backed by high-quality, liquid reserves that can be converted to cash at face value, even during market stress. In practical terms, that means assets like treasury bills and government bonds, not riskier investments that could swing in value.
Clear exits matter as much as reserves
Macklem also focused on how stablecoins work for everyday users. Issuers, he said, should clearly spell out how and when tokens can be redeemed, including any fees involved. Consumers and businesses should know exactly what they are getting before relying on stablecoins for payments.
His comments come as the Liberal government prepares to introduce stablecoin legislation next year. Ottawa has framed the move as part of a broader effort to modernize Canada’s financial system and keep pace with countries such as the United States, which recently set clearer rules for dollar-backed stablecoins.
The timing reflects a global shift. Stablecoins have moved deeper into mainstream finance, raising concerns among policymakers about financial stability and monetary control, especially as foreign digital dollars become easier to use across borders.
Macklem was careful to frame the Bank of Canada’s role as neutral, not promotional. “It’s not really up to the Bank of Canada to encourage stablecoins or discourage stablecoins,” he said. “What matters is that if Canadians choose to use them, they are truly stable.”
Stablecoin rules tie into broader payments reform
The central bank sees stablecoin oversight as part of a wider payments overhaul already underway. Macklem pointed to upcoming upgrades such as Canada’s Real-Time Rail, expected to enable instant payments for consumers and businesses, including cross-border use cases.
He also highlighted open banking as another priority, saying clearer data-sharing rules would make it easier for Canadians to compare services and switch financial providers.
Taken together, the message from the Bank of Canada is clear: stablecoins may have a role in the future of payments, but only if they meet the same standards of safety, transparency, and reliability that Canadians already expect from their money.
