In theory, yeah, you can. In practice, you would need to convince people to remove an area that is currently dedicated to car traffic, in order to turn it into a canal.

Though a canal is way better than car traffic, currently, turning one of those car-traffic-shocked streets into anything but that (eg. bike lanes, pedestrian plazas, etc), is a massive political undertaking. Imagine doing that PLUS coming up with the funds to rebuild and maintain a canal.