Canada Floats 1% Cap on Stablecoin Cash-Outs

Canada’s proposed stablecoin redemption rules would let retail holders cash out directly from issuers within three business days at a fee capped at 1%.

The proposal, published by Canada’s Department of Finance on 24 October, fills in the mechanics of the redemption duty in the country’s Stablecoin Act. As CryptoSlate first reported, the proposed section 15 sets the size, timing and fee conditions for a duty that already exists in the Act’s text: payment at par, or face value, in the currency the token tracks.

What the proposed protections would mandate

Under the proposal, a covered retail holder could ask an issuer for their money back without meeting any minimum amount, creating a direct exit alongside selling tokens through an exchange. Redemption would normally be completed within three business days, and any issuer fee would be capped at 1% of the amount redeemed, a ceiling rather than a fixed charge. Before an issuer starts charging or increases a redemption fee, it would have to give at least seven days’ notice on its website.

The draft rules also contemplate stress. Issuers could limit daily redemptions when a liquidity shortfall in reserve-asset markets prevents them meeting all requests, though the 1% cap would still apply.

How redemption works today

The contrast with current market practice is sharp. Circle’s terms for USDC holders outside the European Economic Area (EEA), updated on 15 October, make direct redemption conditional on a Circle Mint account, a product that excludes individuals and requires institutional checks and a verified matching bank account. Anyone else’s exit is a sale on an exchange, at whatever price the market gives.

There is also a currency wrinkle for this site’s readers. Par redemption of USDC pays in U.S. dollars, so a Canadian holder wanting Canadian dollars would still need a separate conversion or payment arrangement. How Circle or any current issuer would be treated under the final Canadian framework is a separate question.

Not law yet

Every figure here is consultation-stage. The Stablecoin Act received royal assent on 26 March 2026 with its core provisions marked not in force, and the government’s impact statement targets fall 2027 for implementation. The consultation on the redemption rules runs for 60 days from the 24 October publication.

Canada’s approach sits alongside other regimes taking shape. The United States has finalised its own stablecoin rulebook through the OCC’s final rule under the GENIUS Act, which keeps a ban on paying yield to holders, while in Europe the EBA has classed USDC as the first ‘significant’ e-money token under MiCA. Canada’s fee cap and completion clock would give other jurisdictions a benchmark to be measured against.