Canada to examine crypto, stablecoins and CBDCs in new budget
The Canadian federal government is set to launch a consultation on cryptocurrencies, stablecoins and Central Bank Digital Currency (CBDCs) as revealed in the new mini-budget.
The government’s “2022 Fall Economic Statement” released on 3 November by Deputy Prime Minister Chrystia Freeland serves as a fiscal policy update in conjunction with the main budget.
The statement included a small section on “Addressing the Digitalization of Money” that outlined the government’s crypto plans.
It said the rise of cryptocurrencies and money digitization is “transforming financial systems in Canada and around the world” and the country’s financial system regulation “must keep pace.”
The statement opined that digitization of money “posed a challenge to democratic institutions around the world” and highlighted the use of cryptos in sanction evasion and financing of illegal activity both domestically and abroad.
In the statement, the government said stakeholder consultations on digital currencies, stablecoins and CBDCs will be launched on November 3, although exactly which stakeholders will be engaged remains unclear.
The announced consultations are considered to be part of the government’s intention to launch a “financial sector legislative review focusing on digitizing money and maintaining stability and security in the financial sector”, which was part of the 2022 budget released on 7 April.
This review will also examine the “potential need” for a Canadian CBDC in light of these risks.
Related: Quebec’s energy chief will seek government approval to stop operating crypto miners
In January, protests erupted in the nation’s capital Ottawa over the COVID-19 vaccine mandate and restrictions in Canada with protesters migrating to crypto fundraising platforms after being kicked out by competing fiat fundraising platforms.
The province of Ontario declared a state of emergency on February 11 due to the protester’s roadblocks that resulted in the government freezing millions in donations to protesters, at which point protesters collected about 21 Bitcoin (BTC), worth $902,000.
Prime Minister Justin Trudeau invoked the emergency law on February 14 for the first time in Canada’s history that gives him the power to freeze protesters’ bank accounts and monitor “large and suspicious transactions,” including crypto.
Two days later, Canada’s federal police force sent letters to several crypto exchanges demanding they stop processing transactions with more than 30 specific crypto wallet addresses linked to the ongoing protests.
