Is Bitcoin Legal In Canada? (Jun 2023)

Is Bitcoin Legal In Canada?

Bitcoin is legal in Canada and may be bought, sold, and traded in any Canadian province. Unlike other countries where government authorities have outlawed cryptocurrencies, the Canadian government has accepted them as a legitimate investment asset.

Holding Bitcoin in a digital currency wallet and being a crypto trader in Canada is also completely legal, whether you acquire your Bitcoins from a Canadian crypto platform like CoinSmart, Bitbuy or CoinSmart, or buy them directly through a software wallet.

The Canadian government also permits the use of crypto, and you can transfer digital currencies as well. As a result, internet and brick-and-mortar businesses can accept digital currencies as a form of payment if they wish. This implies that many organizations are open to alternative payment technologies to make shopping easier and safer.

Is Bitcoin Mining Legal In Canada?

Considering that Bitcoin is legal in Canada, you can rest assured that Bitcoin mining is also legal in the country. There are no specific laws surrounding cryptocurrency mining, so as long as you follow the general electricity and tax regulations, you’re good to go.

Canada may be one of the best countries for crypto mining due to its relatively low energy costs. However, remember that you'll need one or more powerful computers to mine Bitcoin or any other cryptocurrency, which can cost a pretty penny.

Alternatively, you can mine other cryptos like Helium, which uses a relatively cheap mining rig that costs less than $500.

Is Bitcoin A Legal Tender In Canada?

Although crypto assets are legal in Canada, it's worth pointing out that it's not considered legal tender. That's because the Canadian government only recognizes the Canadian dollar as the country's official currency.

Knowing the distinction is crucial for a variety of reasons: for instance, the fact that cryptocurrencies are not regulated or controlled by any central authority in Canada means that the kinds of transactions that may be completed using cryptocurrency are quite limited. Also, because cryptocurrency is not considered a legal tender, retailers are not obligated to accept it as a form of payment, and Canadians are unable to use it to pay taxes or conduct other government-related transactions.

Additionally, cryptocurrencies don't enjoy the same legal safeguards as traditional currencies. This means there is no federal or provincial insurance on cryptocurrency, as there would be if you kept Canadian dollars in a savings account.

However, if a merchant is prepared to take the risk, they may accept any payment type they choose, including Bitcoin. It's a similar situation to businesses along the border that accept US dollars as payment, although US dollars aren't considered a legal Canadian tender either.

Is Crypto Legal In Canada?

Although Bitcoin is the most valuable cryptocurrency by market capitalization, there are plenty of other cryptocurrencies to trade in as a crypto trader. Fortunately for Canadians, the government doesn't only accept Bitcoin for digital currency transactions, but it also accepts all other cryptocurrencies.

You may trade any cryptocurrency, including the most popular ones such as Ethereum and Dogecoin, as well as lesser-known cryptos like Shiba Inu.

Bitcoin and Ethereum are kings of the cryptocurrency markets. While you may invest in smaller coins, there's a good chance that many of them will lose value.

Do I Have To Pay Crypto Taxes In Canada?

Yes. When it comes to paying taxes, cryptocurrencies are treated like any other investment. In Canada, losses and gains must be recorded on an annual tax return and reported to the Canada Revenue Agency (CRA). According to the Canadian government, the Income Tax Act and tax rules apply to digital currencies.

According to authorities, utilizing digital currency does not exempt citizens of Canada. This implies that when Canadians submit their taxes, the Financial Consumer Agency wants them to disclose any crypto losses or gains they experience while purchasing, cashing out, or mining cryptocurrencies.

The Canadian government has a guide to assist taxpayers in declaring their cryptocurrencies on their tax returns. The essential things to know are that Canadians pay taxes as capital gains or business income, depending on the circumstance.

To calculate the taxable value, cryptocurrencies must be converted to Canadian dollars. The Canadian government allows taxpayers to choose how they want to convert or value cryptocurrency for taxes, but that method must be consistent. Several online calculators may be used to convert cryptocurrencies into Canadian dollars.

It's critical to keep records whenever you buy or sell cryptocurrency since Canadian taxpayers are required to report their gains. These records will be important when it comes time to file taxes.

How To Buy Bitcoin In Canada

To buy Bitcoin in Canada, you'll need to first set up an account with one of many cryptocurrency exchanges. These platforms allow you to buy and sell digital currency (including Bitcoin), and they also allow you to trade other altcoins for Bitcoin.

There are several platforms to choose from. Some platforms (like Shakepay, Newton and Wealthsimple Crypto) are more expensive than others (like CoinSmart, VirgoCX and Bitbuy), and some offer more features than others. After reviewing dozens of options for Canadians, we recommend CoinSmart. Here are a few of the reasons why we recommend CoinSmart over other exchanges:

Best In Canada

Trading fees: 0.2% (Medium) Security: 95% cold storage Signup bonus: $50 Low fees + excellent platform.

CLAIM $50 BONUS ★★★★★ Rated 4.9/5

CoinSmart offers very low trading fees: just 0.2%. It supports 16 cryptocurrencies, verifies accounts instantly, prides itself on its helpful customer service reps, and has a beautiful, well-rated app.

As a Canadian exchange, CoinSmart is regulated by several Canadian financial authorities, which keeps your money safe and secure. CoinSmart is also a publicly-traded company on Toronto’s NEO stock exchange, which means they’re subject to third-party financial and security audits at least once per year.

I've personally used CoinSmart for over a year, and I’ve had nothing but excellent experiences with them. I've tried out many of the other cryptocurrency exchanges on this list, so I'm confident that CoinSmart is a solid, reputable platform for most crypto investors.

From now until June 7, 2023, CoinSmart is offering a $50 signup bonus to Yore Oyster readers who fund their accounts with $200 or more. If you’re looking for a highly-respected exchange that offers the lowest fees, excellent customer service, and a slick mobile app, open a CoinSmart account today.

Features

• Extremely low trading fees (just 0.20% per trade)
• 24/7 customer support available via phone, live chat or email
• Instant account verification
• Supports 16 cryptocurrencies
• Immediate deposits and withdrawals
• User-friendly for both beginners and advanced traders
• 95% cold storage policy keeps your crypto extra secure

Cost

• Account Opening: Free
• Trading Fees: 0.20%

Signup Bonus

$50 bonus when you sign up using this link

Best For

Investors looking to trade stablecoins or altcoins with some of the industry’s lowest fees.

In Summary

Bitcoin is legal in Canada, as are all cryptocurrencies. Therefore, trading Bitcoin for a profit is a great way to make extra income in Canada. Bitcoin is a great way to diversify your investment portfolio, but be aware that you will need to pay taxes on any gains you make from buying and selling crypto, and it'd be wise to keep records of all your transactions.

There are plenty of ways of acquiring Bitcoin in Canada, but we recommend using CoinSmart. CoinSmart is easy of use, has strong platform security, and offers the lowest trading fees in Canada, making it our top choice for Canadians investing in Bitcoin.