Canada Moves to Ban Financial Institutions from Directly Issuing Crypto; Stablecoins Must Be Issued via Independent Non-Financial Subsidiaries

November 10 — The Canadian government has unveiled a budget bill that would prohibit federally regulated financial institutions from directly issuing cryptocurrency and require stablecoins to be issued only through independent non-financial subsidiaries that fall under stablecoin legislation.

Under the budget bill announced on November 5 local time, any cryptocurrency issued must include reserve safeguards such as redemption at par value and asset segregation, and is not covered by public deposit insurance or government guarantee programs. The Bank of Canada will be responsible for issuer registration as well as oversight and enforcement of regulatory compliance. Meanwhile, the stablecoin regulatory framework is expected to take effect next autumn.