Canada's Bold New Rules for "Good Money" Stablecoins

The important things are that they need to be safe and steady. People who put out stablecoins have to sign up with the Bank of Canada, keep their money in a safe place that can't go bankrupt, give monthly reports on how things are going, and tell you how you can get your money back, including any fees or waiting times. The Minister of Finance will also check if they're a threat to national security. Plus, they'll be watched under the Retail Payment Activities Act, and they can't pay interest so people don't think they're stocks.

This all comes as digital stuff is changing fast. Canada decided not to do its own digital currency in 2024 and is now working on controlling private digital currencies. Macklem said we need to be able to trust money, no matter what form it takes. This might mean that the bigger stablecoin companies that follow the rules, like QCAD or Circle, will do well, while the riskier ones that use algorithms will be pushed out. These rules should help big companies start using stablecoins for payments and banking, so Canadians can use new stuff in a safer way.