Canada to review crypto, stablecoins and CBDCs in new budget

The Government of Canada has raised concerns about the risks that digital assets and the digitization of money could pose to its financial system as the reason for launching the consultation.

The Canadian federal government is set to launch a consultation on cryptocurrencies, stablecoins and central bank digital currencies (CBDCs), as revealed in its new mini-budget.

The government's "2022 Fall Economic Statement", released on November 3 by Deputy Prime Minister Chrystia Freeland, functions as a budget update in conjunction with its main annual budget.

The statement included a small section on "Combating the Digitization of Money" which outlined the government's crypto plans.

He said the rise of cryptocurrencies and the digitization of money is "transforming financial systems in Canada and around the world" and that regulation of the country's financial system "must keep pace."

The statement says the digitization of money “poses a challenge to democratic institutions around the world,” highlighting the use of cryptocurrencies to evade sanctions and fund illicit activities, both domestically and internationally. abroad.

In the statement, the government said that stakeholder consultations on digital currencies, stablecoins and CBDCs would be launched on November 3, although it is unclear which stakeholders will be involved.

The announced consultations are part of the government's intention to launch a "legislative review of the financial sector focused on digitizing the currency and maintaining the stability and security of the financial sector", which was part of the budget 2022 published on April 7.

This review will also examine the “potential need” for a Canadian CBDC in light of these risks.

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