The Bank of Canada (BoC) announced on Thursday that Canada should consider the benefits of stablecoin regulation, adding it wants federal and provincial authorities to work together and quickly adopt regulatory frameworks.
The BoC said Canada risks falling behind without rapid modernization of its payment ecosystem, as other countries have already advanced their regulatory frameworks.
Stablecoin prices are not as volatile as Bitcoin since stablecoin values are pegged to a fiat currency.
Speaking at a conference in Ottawa, Ron Morrow, the executive director of payments, supervision and oversight at the BoC, said stablecoins are becoming more popular due to the high cost of international money transfers in some jurisdictions.
Canada’s central bank noted that daily stablecoin transactions now total about US$2.7 billion, with annual usage approaching US$1 trillion.
The Bank for International Settlements (BIS) has also stated its support for integrating stablecoins into regulated systems.
In Canada, regulation of digital assets is currently divided between the provinces and the federal government.