Canada Unveils Draft Stablecoin Rules, Banning Interest Payments
Summary
- Canada’s government released draft stablecoin regulations and opened a 60-day public comment period.
- The proposal would ban interest payments by stablecoin issuers, including indirect payments through third parties, and tighten reserve requirements.
- Non-bank issuers would have to hold reserves equal to the value of outstanding stablecoins at qualified financial institutions in Canada, process user redemptions within three days, and cap redemption fees at 1%.
Forecast Trend Report by Period
Canada has unveiled draft rules for stablecoins that would ban issuers from paying interest and tighten reserve requirements.
CoinDesk reported on October 26 that Canada’s Finance Department released the draft framework and opened a 60-day public comment period.
A key provision would prohibit stablecoin issuers from paying interest to holders. The rules would also bar indirect interest payments made through third parties. Rewards tied to transactions using stablecoins would still be permitted.
The proposal would also strengthen reserve management requirements. Stablecoin issuers that are not banks would be required to hold reserves equal to the full value of stablecoins in circulation. Those reserves must be kept at qualified banks, credit unions or trust companies in Canada.
The draft also sets out users’ redemption rights. Issuers would have to redeem stablecoins within three business days if users request conversion into fiat currency. Redemption fees would be capped at 1%.
Uk Jin
wook9629@bloomingbit.ioH3LLO, World! I am Uk Jin.