Blockchain Venture welcomes draft Stablecoin Act

Mr. Richard Zhou reports BLOCKCHAIN VENTURE CAPITAL INC. WELCOMES DRAFT OF BANK OF CANADA'S STABLECOIN ACT Blockchain Venture Capital Inc. has welcomed the release of the draft of the Bank of Canada's Stablecoin Act, representing a landmark step toward establishing a clear, nationally supervised regulatory regime for fiat-backed stablecoins in Canada. The proposed legislation sets out comprehensive requirements to enhance consumer protection, financial stability and operational integrity. Key elements of the draft act include: A clear ban on yield or interest associated with fiat-backed stablecoin deposits; Mandatory, publicly available redemption policies for stablecoin holders; Strict reserve rules, requiring that reserve assets: Be used solely for redemptions; Be composed of the reference currency or high-quality liquid assets; Be held with a qualified custodian, defined as a Canadian financial institution; Confirmation that compliant fiat-backed stablecoins will not be treated as securities; Enhanced national security, operational reliability and risk management obligations; A new authorization and oversight framework administered by the Bank of Canada. These requirements reflect the direction set out in budget 2025, affirming the federal government's commitment to a safe, transparent and domestically regulated stablecoin environment. Blockchain Venture reaffirms its commitment to meeting all requirements Blockchain Venture has consistently designed CADT and CUSD around transparency, qualified custody, one-to-one reserve backing, and strong compliance. Over the past five years, the company has worked with Canadian regulators and banking partners to uphold robust governance, AML/ATF standards, reserve safeguards and consumer-protection measures. "BVCI welcomes the clarity and direction introduced in the Draft Stablecoin Act," said Richard Zhou, founder and chief executive officer of Blockchain Venture. "From day one, CADT and CUSD have been built around the principles now being formalized by the Bank of Canada. We remain fully committed to meeting all criteria set out in the draft act, including the ban on yield, strict reserve rules, transparent redemption practices and adherence to qualified custodian requirements." Once the act is approved by Parliament, Blockchain Venture intends to participate in the Bank of Canada's authorization regime and operate its stablecoin systems under full national oversight. Blockchain Venture's early leadership in stablecoin development Blockchain Venture has been a pioneer in Canadian and international stablecoin development since 2019: July 1, 2019: launched the CADT stablecoin in Toronto, helping launch Canada into a new era of digital global finance; November, 2019: introduced the CUSD stablecoin, pegged to the U.S. dollar, in Nevada, United States; July, 2020: issued CADT in Canada with the support of Concentra Trust, becoming one of the earliest trust-backed stablecoins linked to the Canadian dollar; 2019 to 2025: worked closely with Ontario, Alberta and British Columbia securities regulators under CSA oversight, advocating for clear, practical rules for stablecoin issuance, security tokenization and exempt market dealer registration; Aug. 12, 2022: listed on the Canadian Securities Exchange, becoming one of the first Canadian public companies with active blockchain infrastructure, stablecoin products and payment solutions; December, 2023, to 2025: submitted exemptive relief applications in accordance with Canadian Securities Administrators' Staff Notice 21-333, seeking approval to enable CADT trading on major crypto trading platforms; However, given the emergence of the new federal stablecoin regulatory regime, Blockchain Venture may consider either continuing or withdrawing these applications depending on the final definition and scope of value-referenced crypto assets and stablecoin issuers under the Bank of Canada's forthcoming Stablecoin Act. Despite years of regulatory uncertainty, Blockchain Venture has remained steadfast in its mission to build secure, compliant and consumer-friendly digital currency systems that bridge traditional finance and blockchain technology. Strengthening Canada's digital asset and payment landscape The introduction of the draft Stablecoin Act marks a transformational moment for Canada's digital finance sector. As stablecoins increasingly support payments, settlements, commerce and blockchain-based services, a nationally supervised framework is essential for protecting consumers and fostering innovation. "This framework represents a major step forward for compliant digital payments in Canada," added Mr. Zhou. "We look forward to contributing our experience and technology to support the successful rollout of this national regime." The draft act is available on-line. Termination of acquisition of Coin Shack After constructive discussions and mutual agreement, Blockchain Venture and Coin Shack determined not to proceed with the previously announced acquisition. This decision was previously disclosed in Blockchain Venture's earlier news release and reflects both parties' shared assessment of regulatory considerations and strategic priorities. About Blockchain Venture Capital Inc. Blockchain Venture is an Ontario-incorporated company registered as a money service business with the Financial Transactions and Reports Analysis Centre of Canada. The company provides blockchain-based financial infrastructure, including: BVC Chain, a proprietary blockchain and distributed ledger platform; BvcPay, a mobile wallet enabling digital transactions using bitcoin, ethereum and CADT; CADT, Blockchain Venture's Canadian-dollar-backed stablecoin for payments, settlements, digital asset issuance and on-chain ledger services. Unless and until Blockchain Venture obtains all necessary regulatory approvals or qualifies for exemptions, there is no assurance the company will be able to proceed with its CADT-related initiatives. We seek Safe Harbor.