Canada Opens 60-Day Consultation on Draft Stablecoin Rules

The draft's core trade-off is clear: one-to-one reserves and fast redemption are investor protections, but the interest ban keeps stablecoins from competing directly with bank deposits or yield-bearing instruments. That combination affects issuers most, since reserve composition and redemption mechanics become compliance costs while the yield ban limits the product's appeal. The 1% fee cap also constrains a revenue line issuers might otherwise use to offset those costs. The open question is whether the consultation surfaces pushback on the interest prohibition, which is the provision most likely to shape how Canadian stablecoins are positioned relative to offshore alternatives.