BoC’s Macklem lays out high-level vision for stablecoin regulation

In a Senate hearing Thursday, Bank of Canada Governor Tiff Macklem offered some high-level guidance on the legislation and regulations that would likely be expected for stablecoins.

Bank of Canada Governor Tiff Macklem said he expects Canadian stablecoins will need to be backed by “high-quality, short-term, highly liquid assets,” laying out expectations for the new digital asset class two days after the central bank was tapped to oversee the sector.

The federal budget, released Tuesday, promised a new regulatory regime for stablecoins, a type of cryptocurrency that’s pegged one-to-one to a fiat currency or stable financial asset or commodity. The budget assigned oversight for the sector to the central bank, which already regulates online payments providers.

Plan for stablecoin rules to