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. On this Page:Contents [show] eToro: Best Crypto Platform for Beginners Our Rating Paypal accepted CySEC, FCA & ASIC Regulated Buy 120+ Cryptos or trade as CFDs Visit eToro 81% of retail investor accounts lose money when trading CFDs with this provider. 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 and trade bitcoin 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 eToro was founded in 2007 as an online trading platform. Since then, it has grown exponentially to offer other services including cryptocurrency trading. Now, it is one of the most effective and reliable cryptocurreny exchanges for Canadians. Aside from its copytrading feature, what ultimately sets it apart from other cryptocurrency exchange platforms is that it allows its users to buy bitcoin and other cryptocurrencies outright without leverage or trade bitcoin CFDs with leverage. It is regulated by reputable financial authorities such as the Cyprus Securities & Exchanges Commission (CySEC) the Australian Securities and Investments Commission (ASIC) and Financial Conduct Authority (FCA). Thus, Canadians can be assured that their personal information and funds are always safe. Initially, eToro was only available as a web-based platform. Now, its users can even enjoy a stand-alone crypto wallet, which is rarely offered by other crypto exchanges. It will enable you to buy bitcoin directly from the app using your Canadian debit or credit card. The app is available on both Android and iOS devices. Getting started on eToro is simple and quick. Simply create an account and make a minimum deposit of $200 to buy BTC and other cryptocurrencies. Canadian cryptocurrency traders can use PayPal, wire transfer, Neteller and debit/credit card as payment options. Our Rating Regulated by reputable financial authorities No commission or deposit fees Reliable customer support High withdrawal fees Visit eToro 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 Apart from the centralized exchange sites mentioned above, you can buy bitcoin on peer-to-peer (P2P) 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. Conclusion 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 for Beginners Our Rating Paypal accepted CySEC, FCA & ASIC Regulated Buy 120+ Cryptos or trade as CFDs Visit eToro 81% of retail investor accounts lose money when trading CFDs with this provider. FAQs 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.
