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Visa Canada has begun testing a settlement approach that uses USD Coin (USDC) to fulfill certain Visa settlement obligations, with Wealthsimple acting as the counterparty. The pilot is underway even as Canada’s regulatory framework for stablecoins—particularly for non-bank issuers—remains under development.
Wealthsimple, which manages more than $100 billion in assets, is using USDC to settle specific Visa obligations in Canada. The change is designed to occur behind the scenes, so retail customers are not expected to see any difference in their experience.
The pilot is intended to streamline settlement operations and provide Wealthsimple with additional flexibility for treasury and liquidity management. Visa’s broader stablecoin activity spans nine blockchains and has reached an annualized settlement run rate of $7 billion, indicating that the company views stablecoins as payment infrastructure rather than only a speculative asset.
For Wealthsimple, using USDC may support faster and potentially cheaper fund movement than traditional settlement rails, particularly for cross-border transactions. However, the regulatory environment in Canada is still being defined for companies issuing or using stablecoins at scale.
The Bank of Canada has outlined plans to supervise stablecoin issuers directly, with a target timeline of rules in place by 2027. The framework is focused on fiat-backed stablecoins issued by non-financial institutions, meaning banks would not face the same ruleset.
Under the proposed approach, issuers would be expected to:
The framework is described as applying to both domestic and foreign issuers, regardless of which currency backs the stablecoin. Circle’s USDC is noted as already meeting Canada’s digital asset listing requirements, which may have contributed to its selection for the pilot.
Key elements of the framework are not yet finalized, including registration requirements, reserve standards, and governance requirements. Companies planning to issue stablecoins in Canada are therefore waiting for the final compliance checklist.
Canada’s target for stablecoin rules is set for 2027, but the exact timing is unclear, with expectations ranging from mid-2027 to late 2027. The uncertainty can affect planning for issuers, including legal preparation and reserve structuring.
Visa’s pilot indicates the company is proceeding with operational testing while the regulatory process continues. The testing is intended to generate real-world data on how stablecoins function within payment settlement infrastructure, potentially supporting earlier compliance readiness once rules are finalized.
Canada’s approach could also influence other jurisdictions. If the framework supports consumer protection and financial stability while enabling innovation, it may be adopted elsewhere. If it is too restrictive, issuers may limit activity in Canada; if it is too permissive, systemic risk concerns could increase.
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