Canada’s Stablecoin Act: How It Compares to GENIUS Act and MiCA

The Stablecoin Act

The Stablecoin Act[2], introduced through Budget 2025 as part of Bill C-15, received Royal Assent on March 26, 2026. It requires issuers making fiat-backed stablecoins available to persons in Canada to register with the Bank of Canada, hold a 1:1 reserve of highly liquid assets with a qualified custodian, disclose their governance and compliance frameworks, and meet ongoing reporting and verification obligations.

The Stablecoin Act excludes federally regulated financial institutions, central bank instruments, and closed-loop tokens confined to a single platform. It has been enacted but not yet in force, with full effect expected around 2027. As of August 2026, no transition or grandfathering period has been formally announced for existing issuers.

Are Fiat-Backed Stablecoins Securities in Canada

While the idea was once hypothetical, Canadian dollar referenced stablecoins currently exist. QCAD, a Canadian dollar stablecoin issued through the QCAD Digital Trust and administered by Stablecorp Digital Currencies Inc., received a final receipt for its prospectus from Canadian securities regulators on November 20, 2025, and has been described as the first Canadian dollar stablecoin cleared for distribution in Canada under a securities law framework.[3] It was subsequently listed on a registered Canadian crypto asset trading platform.[4] At least one further Canadian dollar referenced token, CADC, issued by Loon Technology Inc., also appears to be in circulation.[5]

The Stablecoin Act sharpens a question that Canadian securities regulators have not yet answered. Under Canadian Securities Administrators (“CSA”) Staff Notice 21-333 Crypto Asset Trading Platforms: Terms and Conditions for Trading Value-Referenced Crypto Assets with Clients, published on October 5, 2023, CSA staff take the position that a value-referenced crypto asset (“VRCA”), a category which captures fiat-backed stablecoins, may constitute a security and/or a derivative.[6] Staff Notice 21-333 sets out an interim framework rather than a final characterization.

The Stablecoin Act does not expressly resolve the characterization question in Canada. It creates a registration regime administered by the Bank of Canada, prohibits a person from issuing a stablecoin unless the person complies with the Stablecoin Act and is included on the list maintained by the Bank, and imposes reserve, custody, governance and reporting obligations. Department of Finance Canada has indicated that securities regulators will regulate the exchange and trading of fiat-backed stablecoins on securities exchanges and crypto trading platforms, and that non-fiat-backed stablecoins will continue to be regulated by the relevant provincial or territorial securities regulator.[7] That phrasing suggests that Parliament intended federally registered fiat-backed stablecoin issuers to be regulated primarily through the federal framework, although the Stablecoin Act does not expressly remove stablecoins from securities regulation.

For the time being, the operative position in Canada remains a securities law one. QCAD reached the market under a prospectus receipted by Canadian securities regulators rather than under any federal registration, which indicates that a Canadian-dollar-stablecoin issuer may still need to satisfy provincial securities requirements in order to distribute its token in Canada.

Stablecoin Act vs. GENIUS Act

Canada’s approach shares its core architecture with the United States’ Guiding and Establishing National Innovation for U.S. Stablecoins Act (“GENIUS Act”)[8], which was signed into law in July 2025.

Both regimes establish a dedicated regulatory framework for payment stablecoins, distinct from traditional securities regulation, while preserving the role of securities regulators over certain market activities. Furthermore, both regimes share several features, including:

• Requiring stablecoins to be backed by a 1:1 reserve of high-quality liquid assets, including cash and short-term government securities;
• Requiring ongoing public disclosure of reserve composition; and
• Giving stablecoin holders priority over other creditors if an issuer becomes insolvent.

The main structural difference is oversight: the U.S. splits supervision by size, with issuers above $10 billion in market capitalization regulated federally by the Federal Reserve or OCC and smaller issuers eligible for “substantially similar” state regimes, while Canada centralizes issuer supervision in a single federal authority, the Bank of Canada, rather than using a market capitalization threshold. Despite issuer-level oversight being with the Bank of Canada, provincial securities regulators will still govern the trading, exchange, and secondary market intermediation of stablecoins.

Unlike Canada, where the characterization question discussed above remains open, the United States has moved to resolve it directly. The GENIUS Act appears to remove a payment stablecoin issued by a permitted payment stablecoin issuer from the definition of a security under the federal securities laws, and on March 17, 2026 the Securities and Exchange Commission (“SEC”) and the Commodity Futures Trading Commission (“CFTC”) issued a joint interpretation confirming that payment stablecoins as defined in the GENIUS Act, and stablecoins meeting the SEC staff description of a “covered stablecoin”, do not involve the offer and sale of securities.[9] The practical result is that the same instrument may sit outside the securities perimeter in the United States while remaining, at least on an interim basis, inside it in Canada.

Stablecoin Act vs. MiCA

The European Union’s Markets in Crypto-Assets Regulation (“MiCA”)[10] is a framework governing crypto-assets across the EU. While Canada’s Stablecoin Act focuses specifically on fiat-backed stablecoins, MiCA regulates a much broader range of crypto-assets. While MiCA is the most comprehensive legal framework to date, its stringent custody and banking rules mean major global stablecoins may face significant compliance and operational requirements before accessing the European market. Although MiCA entered into force in 2023, with its stablecoin provisions applying from June 30, 2024, there are further measures being developed, particularly to the area of international stablecoin regulation.

Currently, MiCA requires issuers of e-money tokens (EMTs) and asset-referenced tokens (ARTs) to obtain EU authorization, segregate reserves, guarantee redemption at par, and submit to supervision by national regulators and the European Banking Authority for significant issuers, with an EU-wide passport once authorized. Like MiCA, Canada’s model relies on authorization by a single competent authority rather than a market-cap-based split. However, Canada’s Act does not adopt MiCA’s two-tier ART/EMT taxonomy; it applies a single framework to fiat-referenced stablecoins generally, closer in that respect to the GENIUS Act’s unified “payment stablecoin” category.

MiCA also regulates the intermediaries that sit between an issuer and the end user, which the Stablecoin Act does not. A crypto-asset service provider (“CASP”) is a legal person or other undertaking whose occupation or business is the provision of one or more crypto-asset services to clients on a professional basis. Crypto-asset services are listed exhaustively and include custody and administration of crypto-assets on behalf of clients, operating a trading platform, exchanging crypto-assets for funds or for other crypto-assets, providing advice, and many other acts. A person may not provide any of those services in the European Union unless it is authorized as a CASP by the competent authority of the member state of its registered office or falls within a category of already regulated financial entity permitted to provide specified crypto-asset services after notifying its competent authority.

In practice, a business that only issues a fiat-backed stablecoin and redeems it directly with holders may not require CASP authorization, although it would still need authorization at the issuer level as an issuer of an e-money token or an asset-referenced token. A business that also custodies the token, operates a wallet, runs an exchange or on-ramp, lists the token on a trading platform, or transfers tokens on behalf of clients is likely to require CASP authorization.

Canada does not have a single equivalent intermediary licence. Issuer-level obligations sit with the Bank of Canada under the Stablecoin Act, while trading, exchange and intermediation continue to be regulated provincially under securities legislation. Separate federal obligations may also arise, including registration with the Financial Transactions and Reports Analysis Centre of Canada (“FINTRAC”) as a money services business or foreign money services business under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, and registration with the Bank of Canada under the Retail Payment Activities Act where the business performs retail payment activities.[11] A business planning to operate in both markets may therefore find that a single MiCA authorization in Europe corresponds to several separate Canadian registrations.

Conclusion

Canada’s Stablecoin Act positions the country alongside the world’s leading stablecoin regulatory frameworks. While many of the Stablecoin Act’s operational details remain subject to future regulations, the overall direction is clear: Canada is moving toward a dedicated federal regime that seeks to balance innovation, consumer protection, and financial stability. For now, foreign issuers selling into Canada, the US, and the EU face three separate regimes at different stages of implementation: MiCA is already fully in force, GENIUS Act’s rules are being phased in by U.S. regulators, and Canada’s Stablecoin Act is coming into force.

Returning to the securities characterization question raised earlier: once the Stablecoin Act is in force and a fiat-backed stablecoin is issued by an issuer registered with and supervised by the Bank of Canada, the underlying rationale for the CSA’s interim treatment of value-referenced crypto assets weakens considerably. A stablecoin issued under that federal framework may no longer warrant treatment as a security, and the CSA has an opportunity to revisit Staff Notice 21-333 and confirm its approach before the Stablecoin Act takes effect. Until that happens, issuers in Canada may need to plan for both regimes at once.

International businesses operating across Canada, the United States, and the European Union should also begin assessing how each framework applies to their activities and monitor ongoing regulatory developments closely.

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