Canada Gazette draft would register non-bank stablecoin issuers
The Canada Gazette draft would register non-bank stablecoin issuers in Canada, cap redemption fees at 1% and keep yield off the balances those holders keep.
The Canada Gazette of October 24, 2026 carries the Department of Finance draft setting working rules under the Stablecoin Act for issuers outside the banking perimeter. Part I, Volume 160, Number 43 covers registration, reserves, redemption, fees and yield. The issuer may withdraw reserve returns, while a holder is barred from yield for keeping the coin. A monthly report that is wrong, missing or unavailable deems average outstandings to be $1 billion, the tier with a $750,000 base assessment.
The notice is dated Ottawa, October 9, 2026 and signed by Janna Rinaldi, Assistant Clerk of the Privy Council. Comments stay open for 60 days, with a recorded close of December 23, 2026, addressed to Gloria Wong, Director of Digital Assets at the Department of Finance. The intended start is fall 2027, by order of the Governor in Council, with Bank of Canada guidelines once the text is in the Canada Gazette, Part II.
What a non-bank issuer would have to file
The Act would not regulate banks, trust, loan or insurance companies, credit unions or foreign financial institutions. Other issuers, domestic or foreign, register with the Bank of Canada before issuing and file the coin's name, symbol, reference currency, par value, reserves and custodians. The baseline names five issuers, including QCAD from Stablecorp Inc., CADC from Loon Technology Inc. and USD Coin (USDC) from Circle. Eligible assets may be mixed if backing stays at least one-to-one, and a qualified custodian must be formed under a federal or provincial statute. That keeps Canada's Big Six tokenised-deposit work on the bank side of the line.
Reserves, redemption and the yield rule
Each day the reserve, in the reference currency, must match or exceed the par value of outstanding stablecoins bought by a person whose usual residence, head office or principal place of business is in Canada. Allowed assets are cash and demand deposits, government debt of a country maturing in three months or less, one-business-day reverse repos of that debt, and money market funds limited to those assets. A qualified custodian incorporated in Canada holds them in a segregated, bankruptcy-remote account per coin. The issuer may take returns above par.
Redemption is at par, at any size, within three business days, and a business day is a day other than a Saturday or a holiday. The Department's impact statement maps that window to Canadian T+1 settlement, foreign T+2 settlement and one further processing day. Fees are capped at 1% of the amount redeemed, versus about 0.1% on direct redemption in the cost analysis, with seven days of website notice before a redemption fee starts or rises. A daily limit applies only if market liquidity leaves requests unmet. The three-day duty is separate from the redemption timing in Circle's European USDC terms.
Issuers are barred from suggesting yield for holding, deposit or legal-tender status, a public guarantee, or a Bank of Canada listing when the name is absent. Income-sharing that enlarges or lengthens a holding counts as indirect yield. A reward tied to a transaction, and not to how long the coin is held, is not treated as interest or yield. How Monfi says MUSD reserves sit on the bank's own books is the contrast, because the issuer here keeps the reserve return.
How the annual fee and the clock land
The annual fee is a base plus a variable share of remaining recoverable costs, minus interim charges, with the base rounded to the nearest $100. The base is $750,000 at $1 billion or more of average monthly outstandings, with 75% of remaining costs shared equally in that tier. It is $350,000 from $500 million up to under $1 billion, with 25% shared, and $25,000 under $500 million, where the variable amount is nil. The recoverable supervision bill is estimated at $2.5 million a year.
An issuer already issuing the day before commencement would not be in breach of the pre-issue registration duty if it files within 30 days. A missed filing or a refusal means it must cease issuing. Until the fall 2027 order, the Canada Gazette text remains a draft, and venues on the digital-assets desk still list under Canadian Securities Administrators Staff Notice 21-333.
This article is informational analysis only and is not financial, investment, or trading advice. Cryptocurrencies are highly volatile and can lose substantial value rapidly. Past performance and historical patterns do not guarantee future results. Do your own research and consult a regulated financial adviser before making any investment decision.
Reporting by Karthik Subramanian. Filed 25 October 2026, 20:36 GMT.
Digital Assets Correspondent
Karthik Subramanian is a founder, writer, and technology consultant with nine years in the crypto ecosystem.
