Are you based in Canada and looking to buy bitcoin? In this guide we will explain how to buy bitcoin in Canada and present the top cryptocurrency exchanges for 2020 to help you make your purchase.
eToro: Best Crypto Platform in Canada
- Well regulated in Canada
- Social and copy bitcoin trading
- Paypal accepted
Bitcoin in Canada
Canada is one of the countries that allow the use of digital currencies, including cryptocurrencies.
In order to understand more about the cryptocurrency adoption in Canada, in 2017, the Bank of Canada initiated a survey called the Bitcoin Omnibus Survey (BTCOS) to assess the usage of bitcoin in Canada. The focus was on bitcoin because it is the most well-known digital currency.
The survey revealed that 58% of the respondents own bitcoin for investment purposes, 12% stated that it was because they got encouraged by their friends while 6% said that they use bitcoin for buying goods and services on the internet.
Is buying bitcoin in Canada legal?
Although Canadian financial regulators do not recognize cryptocurrency as a legal tender, it is perfectly legal to buy Bitcoin and trade in Canada. However, the cryptocurrency industry is highly regulated by Canada’s anti-money laundering and anti-terrorist financing (AML/ATF) legislative framework.
In 2017, the Canadian Securities Administrators (CSA) published a statement that showed its concerns regarding Initial coin Offerings (ICOs). In addition, crypto exchanges were put under the anti-money laundering (AML) laws. This required all exchanges to register with the Financial Transactions and Report Analysis Centre (FINTRAC) and report any suspicious transactions of their users.
Best places to buy bitcoin in Canada
The first step to buying bitcoin in Canada will be to find a reliable cryptocurrency platform where you will be able to make your purchase. We have analysed the best Canadian bitcoin sites and ranked them by fees, security and usability below.
1. eToro: Best Canadian crypto platform
- Regulated by reputable financial authorities
- No commission or deposit fees
- Reliable customer support
- High withdrawal fees
2. Bitbuy: Quickest way to buy bitcoin
Bitbuy is one of the best places to buy bitcoin online in Canada. It was established in 2013 as InstaBT with the aim to provide an easy, safe and quick way to access bitcoin. Even after rebranding in 2016, the platform is still committed to its original mission and is one of the most popular crypto exchange platforms in Canada.
The platform offers quick and comprehensive customer support. For instance, apart from the ticketing system, it has a toll-free number that you can call to speak directly to the customer support agent. This is an excellent feature since most exchange sites lack reliable customer support.
Another amazing feature is the straightforward sign-up and verification processes that only take a few minutes to complete. Bitbuy abides by the Canadian Anti-money Laundering (AML) regulations and makes use of an automated verification system. You will only need to enter your basic information to get a verified account.
Unlike eToro, it doesn't allow it users to use its platform without undergoing the verification processes. This makes eToro a better platform since beginners can use all of its features even if they haven't verified their accounts yet.
The site has a sleek and user-friendly design that is also optimized for mobile browsers to enable you to buy bitcoin on the go. In addition, it has resources for beginners, such as a comprehensive guide to buying bitcoin in Canada.
- Sleek and user-friendly interface
- Impressive customer support
- Regular feature updates
- Lacks advanced trading features
3. Bitvo: Instant account registration
Bitvo is one of the most feature-rich crypto exchange platforms in Canada. It was founded in 2018 to facilitate the buying and selling of bitcoin and other cryptocurrencies through its top-notch website and mobile applications.
It differentiates itself from other exchanges by making cryptocurrency transactions very easy. If you are a new trader, you can take advantage of the quick buy and sell order buttons that will give crypto prices at market rates. Experienced traders can use the Advance Trading Screen that offers access to live order book.
The Same Day Guarantee feature means that you will get an instant account registration, and deposit and withdrawal requests will be processed the same day you initiate them. On top of that, you will get live customer support all the time. If you don’t get all of these guarantees, you can ask for a refund for your fees.
Bitvo provides zero trade fees and a 1% withdrawal fee, which is one of the lowest in the industry. The Visa Bitvo Cash Card will allow you to spend directly from your account anywhere Visa is accepted.
Even if Bitvo has good trading platform features, eToro is still a better option because it offers copytrading features as well as the options to trade bitcoin CFDs with leverage or buy bitcoin outright.
- Reliable and fast transactions
- Great customer support
- Offers both web and mobile applications
- Does not feature margin trading
4. MyBTC.ca: Interac e-Transfer, Cash, Bank Wire and Credit Card accepted
MyBTC.ca is a simplified Canadian platform that is easy to use and provides a wide variety of funding methods. One of its most noticeable features is that it allows its users to buy and send cryptocurrencies directly to their wallet address. This will eliminate the hassle to wait to withdraw from an exchange or incur withdrawal fees.
However, if you use eToro, your purchased bitcoin can reach your crypto wallet address much faster because eToro also offers a stand-alone crypto wallet that you can use for free.
To execute your order on the platform, you will be required to complete KYC, which is a simple process. There are two forms of KYC verification processes you can choose from. First, you can submit your identity documents to the verification team for internal review. Second, you can complete the verification process in-person at Canada Post.
If you choose the first method, you will be prompted to submit your government-issued photo ID and a selfie of yourself holding the ID. However, if you value your privacy and don’t mind leaving your home, you can complete the KYC verification at any of the 6000+ Canada Post locations countrywide. You will be required to carry your government ID, proof of residence and the unique barcode issued by MyBTC.ca.
The customer support on the platform is impressive. You can get in touch with the customer agents through email, text, phone call or via its official Facebook page.
- Offers a quick option to buy cryptocurrencies
- Excellent customer support
- Two KYC verification processes
- Higher than average fees
5. Kraken: Excellent security measures
Kraken is a reputable crypto exchange based in San Francisco with an office in Halifax, Nova Scotia to handle its Canadian operations. This makes it ideal for Canadian residents.
Compared to other exchanges available in Canada, Kraken has limited funding options. Right now, the only way to deposit Canadian dollars is through a bank wire transfer. This means that you will have to travel to your bank to initiate the wire transfer physically. Indeed, this is not a convenient method, but if you are willing to go through the process, Kraken is an impressive platform with advanced features.
If you use eToro, you can get rid of the hassle of travelling to your bank since you can deposit using various payment methods such as PayPal, wire transfer, Neteller and debit/credit card.
The best feature on the site is the margin trade option that enables users to borrow funds to buy digital assets. It can be profitable if you know how to use it. Also, it offers discounts to high volume traders, which is rare to find on other platforms.
Kraken is a centralized cryptocurrency exchange platform that seeks to offer the security standards of a decentralized exchange. This means that it does not hold its users; data or personal information, making it less susceptible to hacking.
- Simple sign-up process
- Supports 5 fiat currency deposit
- Advanced trading features
- Few funding options
How to buy bitcoin in Canada using eToro
Step 1: Create an account
The first step to buying BTC through Canadian-friendly eToro is to open your account by clicking on this link. This process is very simple, and you will need to provide your username, email, phone number and your chosen password.
Step 2: Verify your account
To start using your eToro account, you will need to go through the verification process that involves providing proofs of your identity and address.
Your proof of identity should clearly show your name, date of birth, clear picture of yourself and issue date. You can either use a passport or a government-issued ID. On the other hand, the proof of address document should not be older than six months. You can use a bank statement, internet bill, tax letter, etc.
Step 3: Deposit funds
Funding your eToro account is very quick and simple. Just click the ‘Deposit funds’ button and select the amount you want to deposit as well as your chosen payment method.
On eToro, you have the option to deposit funds via your debit/credit card, PayPal, Neteller or wire transfer.
Step 4: Buy bitcoin
Go to the ‘Buy BTC’ page. Enter the amount of BTC you want to buy then click the ‘Buy’ button. After a few seconds, the transaction will be completed and your bitcoin wallet address will receive the BTC you just bought.
Other ways to buy bitcoin in Canada
1. Peer-to-peer platforms
These P2P platforms will enable you to purchase BTC directly from sellers without requiring a third-party to process the transaction. This is a great alternative that offers numerous benefits, especially if you are concerned about transaction fees.
On most P2P platforms, fees are more reasonable ranging from 0% to 0.7%. This is very low compared to the centralized sites that charge up to 10%. Buyers and sellers post adverts looking for trading partners, and a transaction is created when someone accepts the advertisement.
After an advert is accepted, the platform functions like an escrow where it locks the BTC or other cryptocurrencies so that they are inaccessible to both parties. Once the buyer makes the payment, the digital assets are unlocked and released. This helps ensure that the seller does not receive the funds then refuses to send the bitcoin to the buyer.
2. Bitcoin ATMs
A Bitcoin ATM is not like the traditional fiat currency ATM, where you use your debit card to withdraw funds. Instead, it is an internet-connected machine that will enable you to buy bitcoins using cash or debit card. Some Bitcoin ATMs feature a bi-directional functionality where you can sell and buy bitcoins.
A notable feature of these Bitcoin ATMs is that they help you buy bitcoins anonymously, unlike the centralized exchanges. There are no KYC or AML verifications required, making them an excellent option to secure your identity and privacy. However, privacy comes at a high cost. On most Bitcoin ATMs, you will incur between 7% and 10% to buy cryptocurrencies.
Since there are only few Bitcoin ATMs, finding one around you is the toughest part. Some of the cities in Canada with these ATMs include Toronto, Calgary, Edmonton, Winnipeg, Ottawa and Montreal.
3. Face-to-face transaction
The process of buying bitcoin in a face-to-face meeting is similar to the P2P platforms. In fact, you are likely to use P2P platforms to find a seller. However, instead of dealing on the platform, you arrange a one-on-one meeting to exchange the bitcoins for cash or any other agreed payment method.
Buying bitcoin in Canada is easy and quick thanks to the cryptocurrency exchange platforms mentioned above.
If you are a new cryptocurrency trader living in Canada, simply pick one from these secure and reliable crypto exchanges, create your account, deposit funds, buy BTC then you’re good to go! eToro is our recommended choice for Canadian investors due to its fantastic social trading platform which allows beginners to learn the basics of bitcoin trading in an interactive network, its security and regulation, and low trading fees. To get started, click on the table below.
eToro: Best Crypto Platform in Canada
- Well regulated in Canada
- Social and copy bitcoin trading
- Paypal accepted
What is a bitcoin wallet?
Once you have bought BTC and you want to store it, you should use a bitcoin wallet. It is like a bank account wherein you can receive, store and send bitcoins to others. There are various types of bitcoin wallets that you can choose from including a mobile wallet, web wallet, hardware wallet, desktop wallet and paper wallet.
How do I choose the best Canadian crypto exchange?
Due to the vast number of exchange sites in the cryptocurrency industry, it is difficult to choose the best for your needs. The most important thing is to conduct thorough research and compare the pros and cons of each site. Some of the critical factors to look out for are payment methods, fees, limits, ease of access and customer support. If you’re not yet sure what to try, you can check out eToro since it is one of the most recommended cryptocurrency exchanges for Canadians.
Can I use Canadian banks to buy bitcoins?
Yes. According to the Canadian government, financial institutions such as banks do not oversee digital currencies. This means that banks cannot stop you from transferring your money into exchange sites to buy bitcoins. However, you should take note that if you use a credit card, you will incur a cash advance fee.
Am I required to pay taxes on my bitcoin income?
In Canada, residents are required to declare and pay taxes on any income earned. For instance, if you had bought $200 worth of bitcoins and sold at $270, you will be required to declare $70 income in your annual tax return. The income will be subjected to the tax as per the regular capital gain tax regulations.
Is it necessary to declare the value of my digital currency portfolio?
There is no definitive law in Canada that requires you to declare the value of the digital currency you are holding. For example, if you purchased bitcoins worth $200 and the value increases to $250 after a few months without realizing any gain, you are not required to declare the value. However, when you convert the digital currency to fiat currency, you are required to account for any gain or loss in your next tax return.