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Buying Bitcoin in Canada
Canada has an interesting and somewhat controversial history with cryptocurrency. The world’s first publicly available Bitcoin ATM opened in Vancouver in 2013. A second one followed in Toronto in early 2014. Moreover, you may remember the Quadriga news story as the controversy reached headlines worldwide, making you wonder what is the best and safest way to buy Bitcoin in Canada and if the Canadian financial industry is ready for a crypto boom.
Regardless of what you think of when talking about Canada and cryptocurrency, it has never been difficult to access as a Canadian. Apart from the Bitcoin ATMs, the country has classified cryptocurrencies as commodities, and therefore they are legal to purchase and use as a digital currency. This designation is important as it denotes that while you can use cryptocurrency such as Bitcoin to buy goods and services online or in certain stores, it is not legal tender like the Canadian dollar.
Best Canadian Crypto Exchanges for Buying Bitcoin
The best way to buy Bitcoin and other cryptocurrencies in Canada is through an exchange such as Coinbase, Bitbuy, Kraken, Shakepay, CoinSmart and Coinberry. There are a plethora of options available, so it is best to look at each of the exchanges’ processes for deposits and withdrawals, fees, and transaction speeds to determine which is best for you. Our editorial team has ranked and reviewed the top exchanges for Canadians.
- Great customer service
- Low services fees
- Diverse and consistently updated choice of coins
- Great on-ramp for Canadians looking to get involved with cryptocurrency
- Backed by Canadian financial institute
- Small but powerful portfolio of different coins including Bitcoin, ETH, Litecoin and more
- Easy set-up for new crypto users
- Fantastic UI for new cryptocurrency users
- One of the highest levels of security for a Canadian cryptocurrency exchange
- Lists all seven of the major cryptocurrencies including Bitcoin, Ethereum and EOS
- Supports Interac and bank transfers for easy deposits
- Trustworthy exchange
- Supports many different funding options
- Accepts users from across the globe
- High trading volume
- One of the most user-friendly exchanges
- Licensed as an official Money Service Business in Canada
- Incredibly fast with purchases taking minutes rather than hours
- All assets on Shakepay are stored offline
Is Buying Cryptocurrency Easy in Canada?
It is relatively simple to buy cryptocurrency in Canada. The first step is choosing a hardware or software wallet. The second step is picking an exchange to buy virtual currency from. The third and the possibly tedious step is having your identity verified through what is known as a Know Your Customer (KYC) process. This involves providing your full name, date of birth, and residential address to the exchange. Some exchanges require your identity to be verified by providing them with a copy of your passport or government issued ID. Once the exchange has verified your identity, you’re ready to buy Bitcoin in Canada along with additional cryptocurrencies.
Can You Use Canadian Credit Cards to Buy Crypto?
Most Canadian credit card companies have blocked purchase of cryptocurrencies, with the exception of Koho. As their tag line goes, they are pushing for A New Era of Banking. Their visa debit card is one of the only credit cards that enables Canadians to purchase cryptocurrencies on a number of exchanges.
Other options apart from a credit card purchase are Interac e-Transfer, Electronic Funds Transfer, bank wires, or direct purchase through debit.
Is Bitcoin Legal in Canada? What about Other Cryptocurrencies?
Yes! It is legal to buy cryptocurrency in Canada. The Canadian government has classified cryptocurrencies as commodities, meaning that while you can purchase, trade, mine, or interact with cryptocurrency, it is not eligible to be a registered investment and transactions fall under the category of barter transactions.
It is best to think of cryptocurrency in the same vein as gold or silver, or your parents’ record collection that is worth millions but they refuse to part with it.
Can You Buy Cryptocurrency Directly Through Your Bank Account?
There is not way to directly purchase cryptocurrency from an exchange with your bank account, either with a debit card or a credit card. Currently, all known bank accounts restrict the purchase of Bitcoin or any other cryptocurrency.
However, the easiest way to get around that is by sending an e-transfer to your account on the exchange of your choosing, and then convert your CAD to either Bitcoin or any other cryptocurrency.
How to Buy Bitcoin In Canada
When it comes to purchasing cryptocurrency like Bitcoin, it’s best to use an exchange. These are digital market places that allow you to trade, buy and sell cryptocurrency. There are many great Canadian Bitcoin exchanges, you can buy BTC at any of the following exchanges:
Some of the exchanges listed above also feature FIAT to crypto transactions. Meaning, they provide you the ability to exchange your Bitcoin for Canadian dollars.
What Are the Most Famous Canadian Crypto Exchanges?
There are many Canadian based exchanges, two of the most famous/popular being Bitbuy and Coinberry. The most infamous Canadian crypto exchange is Quadriga. One of the biggest crypto news stories of 2019 was the mysterious death of Quadriga’s CEO, and the subsequent discovery that most of the exchange’s wallets were in fact empty, leading many to wonder whether or not Quadriga was a scam, but if the CEO actually died.
Best Bitcoin Wallets for Canadians
There are many great options for both hardware and software cryptocurrency wallets in Canada. These aren’t tangible like the foldable leather piece or money clip you use to keep your identification, various payment methods and credit cards. Check out this guide on Best Cryptocurrency Wallets 2020 to find one that best suits your needs.
Hardware Wallets for Canadians
A hardware wallet is one of the best ways to store your cryptocurrency. It is offline, which means it is inaccessible to hackers, and you can be sure to have sole access to your funds. The following wallets are the best of their kind:
- Ledger Nano X
- Ledger Nano S
- Trezor One
- Trezor Model T
Software Wallets for Canadians
Software wallets are another great way to store you funds as you have sole custody of your funds, and your crypto assets are accessible to you on your desktop or mobile device.
The following software wallets rank high in ease of use as they sport a simple user interface:
- Exodus Wallet
- JAXX Liberty
- Atomic Wallet
- Guarda Wallet
An important thing to remember when it comes to the buying and selling of cryptocurrency in Canada: You will be taxed. In coordination with the Income Tax Act, Canada Revenue Agency treats cryptocurrency like a commodity that can result in capital gains and losses. Taxable transaction include sending, receiving, and trading of cryptocurrencies.
Buying Crypto in Canada FAQ
You can buy Ethereum in Canada. The process is similar to that of buying Bitcoin. Exchanges such as Bitbuy, Kraken, and Shakepay allow the purchase of Ethereum directly via an e-transfer, or wire transfers. Alternatively, you can also use a Koho visa debit to make a purchase.
No, there are no provinces where cryptocurrency is unavailable. This is because they are legal commodities at a federal level. While securities such as cryptos are legally enacted on a provincial basis, the regulations on cryptos have been harmonized across provinces.
The cheapest way to buy Bitcoin in Canada is through an online exchange. The exchange that is cheapest depends on their fees, whether for depositing, withdrawing, or trading. Your preferred funding method is a large factor in which exchange is best for you. It should also be noted that you do not have to use a Canadian exchange (as in Canadian-based), as exchanges such as Gemini & Coinbase accept Canadian customers and have lower fees than some Canadian exchanges.
You can sell your Bitcoin (or any other crypto) in Canada through an exchange. Simply deposit your Bitcoin (assuming its stored on your wallet, and not already on the exchange) onto the exchange. Once it is on the exchange you can sell it for market value, and then once it is sold you can withdraw the funds to the bank account you connected to the exchange. Keep in mind that you will be taxed on any gains made selling cryptocurrency in Canada.
Yes! In fact Vancouver had the world’s first Bitcoin ATM and Canada has the most per capita in the world. Bitcoin ATMs are the most anonymous way to purchase Bitcoin, however they often have much higher fees (6-8% above market) than online exchanges so they are not considered to be the most cost-effective method.