Bank of Canada Senior Deputy Governor Ron Morrow has called for urgent federal stablecoin regulation, warning that Canada risks falling behind globally without modernizing its payment infrastructure. Speaking at the Chartered Professional Accountants conference in Ottawa, Morrow highlighted that Canada's international money transfer costs are "significantly higher" than in the United States and United Kingdom, creating particular challenges for immigrant communities sending remittances overseas.
Current remittance costs range from 5-10% through traditional networks, but experts indicate stablecoins could reduce these fees to "less than 1 percent" by eliminating intermediary costs. Morrow emphasized that stablecoins must be "as safe and stable as the balance in your bank account" before regulators allow widespread adoption.
Canada currently lacks federal stablecoin regulation, relying instead on provincial securities frameworks and federal anti-money laundering provisions. Survey data shows almost 60% of Canadian business leaders believe the country's competitiveness will decline without further payment innovation. Private-sector developments are accelerating, with Shopify adding stablecoins as a standard payment option and a Canadian fiat-backed stablecoin set to launch in 2026 by Tetra Digital Group.
The Bank of Canada now supervises nearly 1,500 payment service providers under the Retail Payment Activities Act, providing a foundation for regulated innovation. Morrow suggested Canada should "weigh the merits of federal stablecoin regulation, similar to what other countries have done," aligning with international efforts by the Bank for International Settlements to integrate stablecoins into regulated systems.