Crypto investing has surged in popularity in recent years, but it can be a complex and risky space. “It’s important for newcomers to invest only with money they can afford to lose,” says Amanallah Abbas, CPA and controller at National Digital Asset Exchange in Calgary. “They should also diversify their portfolio and choose reputable platforms.”

Crypto investing in Canada but they can be used to purchase goods and services. They operate on a decentralized network supported by blockchain technology, which maintains a tamper-resistant record of transactions. These assets can be bought and sold on a number of crypto exchanges. The most popular crypto is Bitcoin, which serves as a store of value, a hedge against inflation and a vehicle for speculative investments.

Trusted Crypto Exchanges in Canada: Security, Fees & Features Compared

Investing in cryptocurrency is not as straightforward as purchasing shares in a stock, and the tax implications are more complicated. Whether or not your gains are taxable depends on whether the CRA considers your investment as business income or capital gains. The CRA makes this determination on a case-by-case basis, so it’s important to consult an accountant to ensure you’re making the right choice.

When selling crypto, it’s essential to keep records of your cost basis and transaction fees. This will help you calculate your profit. If you acquired your crypto for free (gifts, airdrops or swaps) or it was a gift from an individual, the CRA will treat it as having zero cost basis – so any proceeds you receive would be considered capital gains and subject to taxes.