In May 2024, Coinbase announced exciting news for the crypto world. The exchange plans to introduce a stablecoin tied to the Canadian dollar. This stablecoin, QCAD, will soon be available on Coinbase’s platform.
This move is significant as it follows Coinbase’s recent license to operate in Canada. The company revealed its plans through Twitter, stating that it would add QCAD to its list of offerings. QCAD was reintroduced last year by the Canadian fintech firm Stablecorp. It is pegged to the Canadian dollar and is part of an expanding trend in the crypto market.
What Does This Mean for Canadians?
This is great news for Canadian crypto users since QCAD will provide an alternative to users who are reserved about dealing with the volatility of the crypto market. If this stablecoin gains popularity like Tether, we can expect it to be among the supported payment options at e-commerce sites such as online casinos. These gambling sites allow players to make deposits using a variety of cryptos, including Bitcoin and Tether.
With the growing popularity of cryptocurrencies and the introduction of QCAD, these digital currencies are likely to become top banking options at online casinos, just as top Interac online casinos in Canada offer fast and secure transactions
Like well-known stablecoins like Tether (USDT) and USD Coin (USDC), QCAD is designed to keep its value stable. This means that for every QCAD token issued, there are reserves of equal or greater value to back it up.
Stablecorp has confirmed that QCAD is backed by cash and cash equivalents. Each month, the company releases attestation reports to verify its reserves. In its most recent report from February 2024, Stablecorp revealed that there were 169,303.77 QCAD in circulation. This amount was backed by CAD $200,903.17 in the company’s reserves. While these numbers are small compared to major stablecoins like USDT and USDC, the potential for growth is huge.
This launch is perfect, with more regulatory clarity coming from Canadian authorities. Stablecorp’s CEO, Alex McDougall, expressed excitement about last year’s launch, saying that QCAD brings transparency and efficiency to the Canadian market.
Compliance With Canadian Regulators
Coinbase’s launch of QCAD couldn’t have come at a better time. Canada’s regulators have taken steps to ensure that real assets properly back stablecoins. When crypto heavyweights like FTX and Terra collapsed in 2022, the Canadian Securities Administrators (CSA) introduced strict guidelines for stablecoins. This guidance guarantees that only stablecoins backed by “highly liquid assets” and “qualified custodians” are listed on Canadian platforms.
These regulations pushed companies like Kraken and Coinbase to delist some assets, such as Tether (USDT) and Wrapped Bitcoin (WBTC). Binance, one of the largest crypto exchanges, even exited the Canadian market because of these rules. However, these steps also mean Canada’s crypto market is more secure.
Coinbase was the first international crypto exchange to get approval as a “restricted dealer” in Canada in early 2024. This means the company met the requirements of Canadian regulators. Coinbase has also credited Canadian regulators for being more cooperative than their U.S. counterparts. For instance, the Securities and Exchange Commission (SEC) in the U.S. is currently suing companies like Coinbase, Kraken, and Binance for violating securities laws.
Coinbase emphasized its positive relationship with Canadian regulators. We’ve collaborated with pension funds, investment advisors, and banks in Canada,” the company said in a statement, “to demonstrate our commitment to helping them navigate the evolving digital asset space.”
Other Popular Stablecoins in Canada
Stablecoins are critical components of the crypto ecosystem, and QCAD is just the latest to join the market. Canada has already seen the success of several other stablecoins. These coins provide stability to the often volatile crypto world.
Tether (USDT)
Tether is the most popular stablecoin globally and also in Canada. It is pegged to the U.S. dollar, meaning its value remains stable at $1. Tether’s popularity comes from its widespread use across exchanges and platforms. However, due to stricter regulations in Canada, Tether was delisted from Coinbase and Kraken earlier this year. Despite this, many Canadians still use Tether to trade and transfer funds through other platforms.
USD Coin (USDC)
This is another stablecoin linked to the U.S. dollar. Unlike Tether, USDC is known for being more transparent with its reserves. Each month, USDC’s issuers release reports detailing the assets backing the coin. This transparency has helped USDC gain popularity in Canada, especially as regulators push for more accountability in the crypto space. USDC remains available on platforms like Coinbase, making it a preferred choice for Canadian users looking for a reliable stablecoin.
DAI
DAI is a decentralized stablecoin, making it slightly different from Tether and USDC. Most stablecoins are backed by reserves of fiat currency. But DAI is backed by a basket of cryptocurrencies. This allows DAI to maintain a stable value while being more flexible than other stablecoins. DAI is popular among Canadian crypto users who prefer decentralized options. With its unique backing mechanism, DAI offers an alternative to traditional stablecoins, appealing to those who want to avoid reliance on central issuers.
Conclusion
The introduction of QCAD by Coinbase is a significant step for the Canadian crypto market. This stablecoin will offer Canadian users a more stable and transparent option for holding and transferring value. As regulators in Canada continue to provide clear guidelines for the industry, stablecoins like QCAD, Tether, USDC, and DAI will play a key role in the country’s growing digital economy.
With the Canadian government focusing on security and stability, Canadians can now participate in the crypto market with greater confidence. Coinbase’s move to offer QCAD is a testament to the potential of the Canadian crypto market and its future growth.
