At a glance
- Every coin would be backed one-to-one by reserves held with a Canadian custodian in accounts creditors cannot reach if the issuer fails.
- For allocators holding stablecoin balances in a cash or settlement sleeve, the draft fixes the worst case for redemption: any amount within three business days, at a fee of no more than 1%.
- Issuers could still keep what their reserves earn, provided reserves stay at least equal to the coins outstanding.
Canada's draft stablecoin rules would cap redemption fees at 1%, require issuers to redeem any amount within three business days and bar them from paying holders interest.
Every coin would be backed one-to-one by reserves held with a Canadian custodian in accounts creditors cannot reach if the issuer fails. Eligible reserves are limited to cash, government debt maturing in three months or less, and money market funds holding only those assets, according to the draft published in the Canada Gazette and reported by Decrypt.
For allocators holding stablecoin balances in a cash or settlement sleeve, the draft fixes the worst case for redemption: any amount within three business days, at a fee of no more than 1%. A cash sleeve that pays yield on stablecoin balances would have no compliant version under the draft. The yield ban reaches indirect payment, including any arrangement that lets someone earn yield from holding a coin, such as sharing the issuer's income.
"These prohibitions are intended to distinguish stablecoins from financial products that compete directly with bank deposits or other interest-bearing instruments," the notice says. Issuers could still keep what their reserves earn, provided reserves stay at least equal to the coins outstanding.
The draft also bars issuers from presenting a coin as a bank deposit or claiming deposit insurance or a government guarantee, and requires complaints to be acknowledged within seven days and resolved within 30. The Bank of Canada would register and supervise issuers.
Canada's yield ban matches the U.S. GENIUS Act, signed by President Donald Trump on July 18, 2025, which also bars issuers from paying holders interest. Decrypt reports the dispute over letting crypto platforms offer yield to users was divisive enough to help lead to the failure of the Clarity Act in the Senate.
Rewards tied to using a coin rather than holding it would stay allowed, a line that separates transaction incentives from payment for balances.
Reported by the Digital Assets desk from Decrypt. Published . Updated Oct 26, 2026 · 10:52 p.m. ET. Corrections