On July 30, 2026, the Canadian Securities Administrators (“CSA”) granted exemptive relief to a global financial infrastructure company (“the Filer”) from the dealer registration requirement in the context of certain stablecoin transactions that are “immediately delivered” to Canadian clients (i.e., client assets are not held by the platform).
This decision suggests that the CSA is reinforcing its position that transacting in certain fiat-backed stablecoins are activities that fall within its regulatory perimeter and may trigger the registration requirement.
This decision may have implications for non-custodial platforms that are not currently registered under Canadian securities legislation that transact in high-volume fiat-backed stablecoins.
A closer look and key takeaways are discussed below.
Background on the Decision
The Filer is a global crypto asset infrastructure provider that connects fiat and digital assets in one platform. Separate from this business, the Filer established a platform (the “Platform”) that permits Canadian clients to buy and sell certain stablecoins (“Specified VRCAs”) that are settled by the immediate delivery of the purchased crypto assets.
The exemptive relief granted to the Filer applies to transactions entered into on the Platform with Canadian clients for the “immediate delivery” of “Specified VRCAs”.
The decision states that the rationale for the Filer seeking the exemption is because it may “reasonably be considered to be in the business of trading of securities by virtue of entering into [Specified] VRCA transactions”.
Specified VRCAs – USDC and QCAD
A Specified VRCA is defined in the decision to mean a stablecoin issuer that has entered into a public undertaking with the CSA in the form set out in CSA Staff Notice 21-333.[1] Currently, there are only two stablecoins that are considered Specified VRCAs: USDC (Circle Internet Financial, LLC, “Circle”) and QCAD (QCAD, Digital Trust, “QCAD”).
Immediate Delivery
The concept of “immediate delivery” was first raised by CSA staff in CSA Staff Notice 21-327.[2] Briefly, this concept establishes when a platform that is transacting in crypto assets that are not securities and/or derivatives (e.g., bitcoin, ether, etc.) is subject to Canadian securities legislation.
CSA staff will generally consider immediate delivery to have occurred where:
- The platform immediately transfers ownership, possession and control of the crypto asset to the platform’s user, and as a result the user is free to use, or otherwise deal with, the crypto asset without
· further involvement with, or reliance on the platform or its affiliates, and
· the platform or any affiliate retaining any security interest or any other legal right to the crypto asset; and
2. following the immediate delivery of the crypto asset, the platform’s user is not exposed to insolvency risk (credit risk), fraud risk, performance risk or proficiency risk on the part of the platform.
CSA View on Fiat-backed Stablecoins
In February 2023, the CSA published Staff Notice 21-332 which stated that they generally view fiat-backed stablecoin arrangements to meet the definition of a “security” and/or “derivative” in several jurisdictions.
In October 2023, the CSA proposed an interim approach that required stablecoin issuers to enter into public undertakings with the CSA regarding certain representations and commitments. Currently, there are only two stablecoin issuers that have entered into these undertakings: Circle and QCAD.
Specified VRCAs
Circle
In December 2024, Circle entered into an undertaking with the CSA. While Circle did acknowledge the position of the CSA in this undertaking, it did not concede that USDC is a security and/or derivative and it also did not consider USDC to be a security or a derivative under the “extant regulatory regimes in the United States or the European Union”.
QCAD
In November 2025, QCAD received regulatory approval from the CSA to qualify a distribution of a Canadian-dollar denominated stablecoin under a prospectus. QCAD also obtained exemptive relief from certain securities law requirements, including the adviser registration requirement.
CADD
In May 2026, Tetra Digital Group announced the launch of CADD. Unlike QCAD, the CADD tokens have not been qualified under a prospectus. Rather, the issuer of CADD has likely taken the position that CADD is not a “security”.
This is because in most jurisdictions of Canada, an “evidence of indebtedness” issued by an appropriately regulated loan or trust corporation (e.g., Tetra Trust Company is registered as a trust company in Alberta) is statutorily excluded from the definition of a security. However, a similar exclusion does not apply to the definition of a “derivative” in many Canadian jurisdictions.
Key Takeaways:
· while the CSA states that the decision should not be viewed as a precedent, in practice, this has rarely been the case;
· from CSA staff’s perspective, this decision is consistent with its position in Staff Notice 21-332 that fiat-backed stablecoins will generally meet the definition of a “security” and/or “derivative”;
· platforms and other intermediaries transacting in high-volume fiat-backed stablecoins, even where custody is not maintained, should carefully consider potential implications under Canadian securities legislation (e.g., dealer registration);
· while CSA staff’s characterization of fiat-backed stablecoins is not law and has not been endorsed by any tribunal (e.g., the Capital Markets Tribunal) or judicial court, it would still carry substantial deferential value in a subsequent hearing; and
· it remains to be seen how the CSA’s existing approach to regulating activities involving stablecoins under Canadian securities legislation will inevitably interact with the federal government’s Stablecoin Act.
[1] CSA Staff Notice 21-333: Crypto Asset Trading Platforms: Terms and Conditions for Trading Value-Referenced Crypto Assets with Clients, available here: https://www.osc.ca/sites/default/files/2023-10/csa_20231005_21-333_crypto-platforms-vrca.pdf.
[2] Guidance on the Application of Securities Legislation to Entities Facilitating the Trading of Crypto Assets, available here: https://www.osc.ca/sites/default/files/pdfs/irps/csa_20200116_21-327_trading-crypto-assets.pdf.