A stablecoin yield looks like a better GIC rate, but it is taxed differently, carries risks an insured deposit does not, and in Canadian dollars it is really a US-dollar position. This comparison puts the stablecoin, a GIC and a savings account on the same after-tax basis, in or out of a TFSA, subtracts the loss risk you choose, and shows how much USD/CAD has swung over the same holding period.
How to use it
- Enter the Amount and choose “For how long” (1 to 5 years); the GIC rate defaults to a Bank of Canada posted rate (1-, 3- or 5-year).
- Enter the Stablecoin yield you were offered, the “Chance per year of a loss event” and the “Share lost if it happens”.
- Replace the GIC rate and High-interest savings rate with the rates you can actually get, and enter your marginal tax rate.
- Tick “Hold the GIC or savings in a TFSA” if you have room.
- Read the expected result, the USD/CAD range, and “What would make it a tie?”.
Putting the three on the same basis
Each option grows yearly at its rate after tax. GIC and savings interest is fully taxable income outside a registered account, and untaxed inside a TFSA; the 2026 TFSA dollar limit is $7,000. The stablecoin yield is taxed every year in this model, because yield paid on stablecoins is generally income and the tool assumes the coins are held outside a registered account.
The stablecoin then gets an expected value: its no-loss result multiplied by the chance of getting through each year without a loss event. A loss event stands for anything that costs you part of the balance: a platform failure, a hack, a freeze or a depeg. Nobody can measure that chance precisely, so it is your input, and the grid shows the result across several values.
Worked example: an emergency fund for one year
The preset “Emergency fund, 1 year ” compares $10,000 for one year: a 5% stablecoin yield (an illustrative offer), a 2% yearly chance of losing 50%, the 2.45% posted 1-year GIC rate (Bank of Canada, observed 2026-10-28) in a TFSA, 2% savings, and a 30% tax rate.
If nothing goes wrong, the stablecoin ends at $10,350.00: 5% less 30% tax is 3.5%. Allowing for the loss risk, its expected value is $10,246.50. The GIC in a TFSA ends at $10,245.00, tax-free. The stablecoin is ahead by $1.50 on an expected basis, which is a tie: it would lose its edge at a 2.03% yearly loss chance, or at a yield below 4.98%. Outside a TFSA the GIC keeps 1.715% after tax, ends at $10,171.50, and the stablecoin's expected edge rises to $75.
Then add the currency. Over every one-year window since January 2017 (3,223 start dates; Bank of Canada data, converted by DeFiCalculator.ca), holding US dollars changed in CAD terms by between −14.5% and +12.0%, and the middle 80% ran from −4.9% to +6.2%. Applied to the expected stablecoin value, that is roughly $9,748 to $10,878: a range far wider than the $1.50 difference.
| Option | Ending value after 1 year |
|---|---|
| Stablecoin, nothing goes wrong | $10,350.00 |
| Stablecoin, expected after loss risk | $10,246.50 |
| GIC in a TFSA (2.45%) | $10,245.00 |
| Savings in a TFSA (2%) | $10,200.00 |
| GIC outside a TFSA, after tax | $10,171.50 |
Longer terms and higher yields
The preset “$25,000 for 3 years” uses a 6% stablecoin yield, the 3.20% posted 3-year GIC rate outside a TFSA, and the same 2% chance of a 50% loss each year. The stablecoin's expected value is $27,444.08 against $26,717.91 for the GIC, an edge of $726.17, and the chance of at least one loss event over three years is 5.9%. The three-year USD/CAD range (10th to 90th percentile, −4.6% to +10.3%) still spans more than the edge.
The preset “A 12% stablecoin yield” pairs a high rate with an 8% yearly chance of losing 70%. Its no-loss value is $10,840.00, but the expected value is $10,232.96, $12.04 behind the 1-year GIC in a TFSA. A high quoted yield is usually paying for a higher risk of loss; the tie point here is a 7.84% yearly loss chance.
Insurance, and what the model leaves out
CDIC insures eligible deposits at member institutions, including GICs, up to $100,000 per insured category, and lists cryptocurrencies, including stablecoins, among the products it does not cover. Canada's Stablecoin Act received Royal Assent in March 2026 but is not yet in force, and it would not make a stablecoin an insured deposit.
The loss model is deliberately simple: one yearly chance of losing a fixed share. Real failures cluster; several crypto lenders failed within months of each other in 2022. Platform fees, withdrawal limits, the cost of converting CAD to a stablecoin and back, and the tax on that conversion are not included. The rates are held constant for the whole term. For a yield whose costs are gas and swaps rather than default risk, use the fees vs yield calculator.
What this means for you
Decide what the money is for first. An emergency fund needs to be there in the bad case; a small slice you can afford to lose can chase yield.
If the stablecoin is in US dollars, its value in Canadian dollars moves every day. The tool shows the historical range of that swing over your holding period from Bank of Canada data.
Definitions
- Depeg
- A stablecoin trading below its intended value, sometimes permanently.
- GIC
- Guaranteed investment certificate: a fixed-term bank deposit, CDIC-insured within limits at member institutions.
- Expected value
- The average outcome after weighting the loss case by its chance.