There is a lot of confusion surrounding the legality of cryptocurrency in Canada.
The legality of cryptocurrency is a hotly debated topic around continents and countries worldwide.
Some people believe that it is completely legal, while others say it is illegal and should be avoided at all costs.
The truth is that the answer is not as black-and-white as one might hope for.
This article will give you the facts about the legality of cryptocurrencies in Canada so you can make an educated decision on whether or not to invest your money in this volatile market.
Is Cryptocurrency Legal in Canada Today?
Yes, Cryptocurrency is legal in Canada today.
In April 2019 the Canadian Securities Administrators (CSA) released a bulletin that is primarily aimed at clarifying whether digital currencies/cryptocurrencies are considered securities under federal law and the provincial legislation of each participating jurisdiction.
Residents of Canada are able to purchase, hold, trade, and invest in cryptocurrency without incurring any legal obligations.
The CSA is composed of the Investment Industry Regulatory Organization of Canada (IIROC), the Canadian Securities Exchange Limited, The Mutual Fund Dealers Association of Canada (MFDA), and is chaired by Jim Sinclair from JDS Capital Management LP.
Together they work closely with provincial securities regulators including those in British Columbia, Alberta, Quebec, and New Brunswick who are all members or participants as well.
There is no federal legislation that prohibits trading cryptocurrencies/digital tokens.
But there is some regulation being introduced such as KYC or know your customer standards which have been imposed on regulated exchanges in order to combat money laundering activities within crypto markets.
Canadians can buy digital tokens safely on exchanges without being subject to any specific requirements.
Top 19 Cryptocurrencies to Invest in Canada
Here is the top 20 cryptocurrencies for anyone living in Canada can invest today:
- Bitcoin (BTC)
- Ethereum (ETH)
- Ripple (XRP)
- Litecoin (LTC)
- Tron (TRX)
- Binance coin (BNB)
- Polkadot (DOT)
- Stellar Lumens (XLM)
- Basic Attention Token (BAT)
- EOS (EOS)
- NEM (NEM)
- Cardano (ADA)
- Shopping io (SPI)
- IOTA (MIOTA)
- Monero (XMR)
- Dogecoin (DOGE)
- Neo (NEO)
- VeChain (VET)
- Nano (NANO)
To purchase any of these cryptocurrency coins or tokens you’d have to do that via an exchange that’s convenient for Canadians.
This leads us to…
How can I buy Bitcoin legally in Canada?
To buy your Bitcoin or any crypto in Canada, you’d have to do that through a Canadian crypto exchange.
There are lots of cryptocurrency exchanges available for you. Some of them include:
- Binance (best overall and for low fees)
- Coinbase (a popular exchange)
- Kraken (best exchange for bank transfer)
- Gemini (best for security)
All you need is an account and a payment method.
Which is usually cryptocurrency. Once your funds are in the exchange, all you have to do is purchase some Bitcoin or any crypto of your choice.
From there on out, if you want to buy more Bitcoin/crypto from another country’s exchange (i.e: Coinbase), just make sure they accept Canadian dollars first before transferring them over.
The best part is that it doesn’t matter where in Canada you live since most exchanges will allow for worldwide transfers as long as they’re connected to a traditional bank account.
Can you buy crypto with a credit card in Canada?
Of course, you can buy crypto with a credit card in Canada.
There is no specific law in Canada that prevents the use of credit cards for Bitcoin transactions.
However, there is one major caveat: most banks and financial institutions have banned crypto purchases made on their networks to comply with anti-money laundering laws.
That means you’ll need to look elsewhere if you want your purchases to go through without any hassle or extra fees.
However, to buy safely and legitimately buy cryptocurrency in Canada you have to do that through a trusted crypto exchange or vendors like:
- Binanace – Top crypto exchange with tons of coins and tokens
- Coinbase – is the world’s most popular digital wallet
- Kraken – is a great exchange for high-volume trading
- CEXIO – one of Canada’s largest Bitcoin exchanges
How do I Convert my Crypto or Bitcoin to Cash in Canada?
To convert your crypto to cash in Canada, you will need to use a reputable exchange. Like the ones, we mentioned above.
You can sell your Bitcoin for CAD (Canadian dollars) and withdraw it to a bank account or cash out at an ATM in Canada.
It is pretty easy to convert Bitcoin to CAD, all you need is a Canadian bank account to where you converted funds would be transferred to.
However, if you already have a Canadian bank account and don’t want to use an exchange, then you can just sell your Bitcoin for CAD on the platform of your choice and withdraw it from that same account.
Is Cryptocurrency regulated in Canada?
In Canada, cryptocurrencies are primarily regulated under securities laws as part of the regulators’ mandate to protect the public.
Cryptocurrencies have not only been a controversial topic in recent years due to the potential for abuse and money laundering.
But they can also be hard to track which makes them an attractive option for those looking towards evading taxes or other regulations.
To avoid this issue though Canadian regulatory bodies like CIBC require KYC (know-your-customer) information such as full name, address, and contact details before allowing someone access tokens on their platform.
So if you’re trading with cryptocurrency it’s important that you comply with these requirements first.
Is Bitcoin Legal in Canada?
Canada is among the top countries around the world that allows for cryptocurrency and Bitcoin transactions.
This has led to an explosion in online and physical stores accepting digital currencies as well, making it easier than ever before to access any product you want with minimal hassle or extra fees.
Is Coinbase legal in Canada?
Of course, Coinbase is legal in Canada.
Coinbase is one of the most popular cryptocurrency exchanges and it is legal to use it anywhere you are legally allowed to operate a business or exchange currency for goods, services, other currencies, etc.
If you want to get started with purchasing Bitcoin or Ethereum on Coinbase click here!
What is the future of cryptocurrencies in Canada?
Inasmuch as the Canadian authorities have made it known that digital currencies are not legal tender – the cryptocurrency market in Canada keeps booming.
This makes the future of cryptocurrency in Canada a bright one because even though there is no legal tender status, the market is vibrant.
This is because Bitcoin and other altcoins are trading freely in Canada – meaning that they can be traded for cash through cryptocurrency exchanges or peer-to-peer transactions.
As a result of this situation, cryptocurrencies remain very much alive in Canada.
Moreover, even if one were to take into consideration the government’s stand on digital currencies as not being legal tenders then again it would not have any adverse effect on their operations.
Considering that these currencies don’t need governmental approval anyway before starting up trade.
Which is one of the interesting things about crypto.
All said and done, we will just have to wait and watch how things progress with regard to regulations governing cryptocurrencies in Canada.
Which shouldn’t take too long now since cryptocurrency is still sort of a new phenomenon.
Is Bitcoin or Cryptocurrency taxable in Canada?
Cryptocurrency transactions are taxed in Canada as either capital gains or income tax, depending on whether your activity with cryptocurrency is considered to be a business.
As you may know, there is no provision for the taxation of cryptocurrency in Canada, as is the case with most countries.
On one hand, if you are a trader or investor and your activities consist primarily of buying and selling cryptocurrencies on an exchange at intervals shorter than a year (either by trading but not mining), then whichever type of tax applies to either capital gains or income taxes will apply to any profits.
All in all, the CRA has not yet talked about Bitcoin taxes in any of its Information Circulars or Interpretation Bulletins.
But the CRA has told people about how it treats payments with Bitcoins in Income Tax Rulings and Technical Interpretations.
Is cryptocurrency trading and investing legal in Canada?
100% yes, it is legal to trade in cryptocurrency in Canada.
You know, Canada is a great place to live, and it is one of the best countries in the world. The country is much better than many others when it comes to cryptocurrency regulations.
Since there are no clear laws or rules about this type of trading.
You should be aware that while Canada has some good aspects for crypto traders; like being able to use cryptocurrencies privately without any problems, every person still needs to pay taxes on their bitcoin profits just as they would with other investments made through financial institutions.
Is mining cryptocurrency legal in Canada?
Yes, Bitcoin and cryptocurrency mining is legal in Canada. In fact, Quebec is the location of some of Canada’s largest cryptocurrency mining operations.
However, it is not legal to use Bitcoin in place of currency – this is considered money laundering and violates Canadian monetary laws.
That being said, even in places where Bitcoin/Bitcoin mining is legal, some Bitcoin mining is done illegally.
So, in order to make sure you aren’t mining illegally, you should check the legality of Bitcoin mining in your state and country.
Do Canadian banks accept Bitcoin or any type of Crypto?
At the moment no, Canadian banks do not accept Bitcoin.
This is most likely due to the fact that there is no clarity on tax implications from the Canadian government, and this is something they are trying to figure out how to deal with before making any decisions.
However, some of Canada’s major trading platforms offer direct access for BTC purchases in CAD including CoinSquare (which operates as a marketplace), Poloniex, and Coinsquare.
Is Cryptocurrency Legal in Canada? – Final Thoughts
Cryptocurrency is an unregulated digital currency that is used as a medium of exchange.
Cryptocurrencies are not backed by any government or central bank, and the value is determined by supply and demand on public markets.
Because cryptocurrency is not regulated in Canada, it is difficult to say with certainty whether there will be legal consequences for those who choose to use Bitcoin within Canada’s borders.
Canadian regulators are still in the process of catching up with cryptocurrencies and their underlying technology blockchain.
However, there is no evidence to suggest that they want to ban their usage outright. Cryptocurrencies remain very much alive in Canada.
Just be aware that it is money according to Canadian monetary laws so it is illegal to use bitcoins as currency (that is considered money laundering) however some mining is done illegally even when it’s legal.
You can invest or mine for the time being – just make sure you are following all applicable laws.