Crypto Regulations In Canada (Updated 2025): Everything You Need To Know About It

Nowadays, cryptocurrency has developed to be leading the game in the investment world due to its fast growth and wider adoption. There is no denying that cryptocurrency has become one of the hottest topics in the world, and there is no exception for Canada.

Crypto industry has topped all Canadian fintech investments 2 years in a row. Canadians are capable of directly trading cryptos in multiple crypto exchanges in Canada by following the rules and regulations formed under certain clauses by the Government.

However, some Canadian traders may be confused when conducting crypto trading, such as, what are the crypto regulations, is it legal to trade crypto in Canada, who’s checking over these trades regularly, etc. In this article, we’ll dive in all the essential rules and regulations for the Canadian people in terms of cryptocurrency.

BTCC, one of the longest-running crypto exchanges in the world, supports crypto demo trading, crypto copy trading, crypto spot trading for 240+ crypto pairs, as well as crypto futures trading for 360+ crypto pairs with a leverage of up to 500Χ. If you want to start trading cryptocurrencies, you can start by signing up for BTCC.

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Is Cryptocurrency Legal in Canada?

Absolutely! Canada has embraced cryptocurrency and it is completely legal to buy, sell, and use digital currencies in the country. Canada ranked 19th in 2023 Global Crypto Adoption Index by Chainalysis, being one of only four G7 countries on that list, which fully demonstrate the wide adoption of crypto in this country.

Notably, in 2014, Canada was the first country which focused on drafting the official guidelines related to crypto trading brokers to have more security and with the motive to preserve consumer rights. Despite the supportive stance of Canadian government on cryptocurrency, laws related to cryptocurrency in this country generally come with certain limitations and regulations to maintain the integrity and security of the data. It also ensures the safety and fairness in the market.

How are Cryptocurrencies Regulated in Canada?

In terms of regulations of cryptocurrencies in Canada, it is primarily revolve around AML/CTF laws, consumer protection, security, and market integrity.

Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) Laws

In Canada, all crypto exchanges and digital currency businesses must register with FINTRAC and should comply with AML/CTF laws. These laws include customer identification, transaction monitoring, and reporting suspicious activities. They provide an instant update regarding that to break the flow and prevent the customer’s data in any kind of hacking, spamming, etc.

Consumer Protection

CSA looks over all the matters related to consumer protection in the crypto space, ensuring that investors are prominently informed about all the scams, and protected from such scams or fraudulent activities too. They have the right to directly interfere with any crypto businesses, if they identify misleading or deceptive conduct which may cause damage to the customers.

Market Integrity

CSA also monitors the integrity of the crypto market, solving some of the core issues like market manipulation, conflicts of interest and insider trading. All these matters are directly handled by them and they enforce rules to promote fair and transparent trading by maintaining the investor’s confidence.

Who are the Watchdog Regulating Cryptocurrencies in Canada?

In terms of regulatory framework relating to cryptocurrency in Canada, the main regulators for cryptocurrencies in Canada include Canadian Securities Administrators (CSA), Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) as well as Office of Superintendent of Financial Institutions (OSFI).

What are Regulations Requirements for Crypto Exchanges in Canada?

Crypto exchanges operated in Canada are subject to Canadian regulations to ensure consumer protection and market integrity. To operate legally, they must:

• Register with FINTRAC and comply with all the AML/CTF regulations.
• Also abide by securities regulations if they offer digital security assets like crypto products
• Implement all the robust and strong security measures to protect users’ funds and personal information.
• Provide clear and transparent information to the users about their platform fees, risks, and other trading policies.

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Are There Any Restrictions on Mining Cryptocurrency in Canada?

The process of virtual currency mining relies on specialized, high-speed computers and is highly energy-intensive. However, Canada’s cold climate and relatively low electricity costs make it an attractive destination for virtual currency miners. While virtual currency mining itself is not currently subject to specific regulations in Canada, the operation of mining hardware may be subject to provincial and municipal requirements related to energy usage.

The growing electricity demand in this sector, along with concerns over its environmental impact, has led some provincial and municipal governments to impose temporary restrictions on new virtual currency mining applications. Effective May 17, 2024, the Province of British Columbia amended the BC Utilities Commission Act, granting the government authority to establish permanent regulations governing the electricity supply to cryptocurrency miners. These regulations may include prohibitions, restrictions, or other controls on electricity service for cryptocurrency mining projects. Previously, in December 2022, the BC government issued a directive to the BC Utilities Commission, authorizing BC Hydro to impose an 18-month moratorium on new cryptocurrency mining projects.

Similarly, in January 2023, at the request of Hydro-Québec, Québec’s Régie de l’énergie (energy board) approved the suspension of the process for allocating electricity capacity for cryptographic use in blockchain applications, pending a reassessment of the megawatt capacity involved. Currently, any new crypto mining project in Québec that requires at least 50 kilowatts (kW) of installed capacity for blockchain-related cryptographic use is subject to the Rate CB pricing of 16.603¢/kWh for energy consumption.

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Do Traders Need to Pay Taxes on Their Cryptocurrency Transactions in Canada?

In Canada, yes. Just like any other form of investment, cryptocurrency transactions are subject to taxation in Canada. The Canada Revenue Agency (CRA) treats crypto as a commodity, not currency, so gains or income from crypto activities are taxable. The CRA is actively enforcing crypto taxation. Failure to properly report can result in penalties, interest, and potential audits.

The tax you pay depends on whether your activity is classified as capital gains (50% taxable) or business income (100%). Foreign holdings and GST/HST also may apply. Below is a summary table:

What are the Requirements for Being a Money Services Business (MSB) ?

As per cryptocurrency regulations in Canada, all crypto companies come under this category of Money Services Business (MSB).  Additionally, they fall under the category of “Proceeds of Crime and Terrorist Financing Act (PCTFA).”  All of the companies or firms that are directly dealing with the virtual currency exchanges, have to firstly get registered with FINTRAC.

As an MSB, there will be certain requirements which you’ll have to fulfill such as formatting a compliance program in line with all the financial regulations currently being operated in Canada, data for all the transactions, reporting for multiple reports, and client identifications.  Even if any kind of suspicious activity, transactions, terrorist funding, or other issues happened, then you’ll be directly reporting to the FINTRAC.

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Final Words

As the adoption and popularity of cryptocurrency continue to grow, it is crucial to have a comprehensive understanding of the legal framework governing its use, trading, and regulation in Canada. Given that crypto trading remains a relatively new form of investment, regulatory policies are continually evolving to enhance security and create a safer environment for all investors and market participants.

Therefore, it is strongly recommended that all stakeholders stay informed about the latest regulatory developments and compliance requirements. Doing so will enable them to navigate the market more responsibly and contribute to the long-term, sustainable growth of the Canadian cryptocurrency ecosystem.

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Where to Buy Cryptocurrencies in Canada?

If you want to trade cryptocurrencies in Canada, you can easily start by creating an account with BTCC, one of the longest-running exchange in the world. As a old exchange enjoy good reputation, BTCC is more reliable. Fully licensed and regulated in the U.S., Canada, and Europe, BTCC is a well-known cryptocurrency exchange, boasting an impeccable security track record since its establishment in 2011, with zero reported hacks or breaches. BTCC platform provides a diverse range of trading features, including demo trading, crypto copy trading, spot trading, as well as crypto futures trading with a leverage of up to 500x.

BTCC is among the best and safest platforms to buy cryptocurrencies. The reasons why we introduce BTCC for you summarize as below:

Industry-leading security

BTCC attaches great importance on security. Since founded in 2011, BTCC has never been hacked or been a victim of any other kind of successful malicious attack, which fully illustrates its security capabilities. Through measures like segregation of assets, 1:1 storage of users’ assets, money laundering prevention and identity authentication and no collateralising tokens for loans, BTCC enjoys good reputation in asset security.

High Liquidity & Volume

BTCC is ranked top 10 by trading volume on both CoinMarketCap and CoinGecko, the world’s two largest crypto information platforms. BTCC prides itself on providing crypto futures trading services to users worldwide with market-leading liquidity, offering perpetual futures on over 300 cryptocurrencies, including BTC, ETH, DOGE, LTC, SOL, XRP, SHIB, etc.

Extremely low fees

BTCC offers a highly competitive fee structure, especially attractive to futures traders. For spot trading, maker fees are set at 0.2%, while taker fees stand at 0.3%. However, the platform truly distinguishes itself in futures trading, where maker fees drop to just 0.025% and taker fees to 0.045%.

High and rich bonus

BTCC holds all kinds of campaigns where investors can participate to win exciting bonus. For example, new users can get rewards up to 10,055 USDT coupon through completing relevant missions, like registration, identity verification, first deposits, cumulative futures trading volume, etc. Besides, becoming VIP also can enjoy rewards like VIP-exclusive perks, including discounts on trading fees, access to exclusive campaigns, BTCC merch, priority customer support, fast withdrawal, and many more.

Excellent customer service

BTCC also gains great reputation in terms of customer support. If you are confused or have problem in the process of trading currencies, you can obtain customer support via email and live chat, BTCC offers 24/7 online customer service for you.

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How to Trade Crypto Futures on BTCC?

BTCC supports trading for USDT- M Perpetual Futures contracts with a leverage of up to 500×, you can trade over 360 cryptocurrencies on BTCC at the most competitive price and highest security.

The following sets forth the step-by-step guidance for crypto futures trading on cryptocurrency exchange BTCC:

Step 1: Create a BTCC account

Step 2: Complete BTCC’s identity verification

Go back to the BTCC official homepage, choose “Futures” -“USDT-M Perpetual Futures Contract”, and find the crypto trading pair that you want to trade.

Then, choose the contract trading order type. Futures contract orders on BTCC platform include market orders, limit orders and SL/TP orders.

• Market Order: users place orders at the best price in the current market to achieve fast trading.
• Limit Order: Limit orders are a type of order to buy or sell futures at a price more favourable than the market price. When you buy at a price lower than the market price or sell at a price higher than the market price, the order will be in the form of a limit order.
• SL/TP Order: SL/TP orders are a type of order to buy or sell futures at a price less favourable than the market price. When you buy at a price higher than the market price or sell at a price lower than the market price, the order will be in the form of a SL/TP order.

Next, adjust the leverage multiple.

Please keep in mind that operating leverage carries the risk of liquidation. Leverage should be adjusted based on your financial status and risk tolerance.

Then, choose the lot size and set the SL/TP price. After setting the basic data information, users can choose to buy (open long) or sell (open short) after entering their ideal price. Traders should remind that the price cannot be higher or lower than the highest buying price or lowest selling price of the platform.

Finally, click the buy or sell button, and the crypto futures contract order is completed.

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BTCC Exchange FAQs

Is BTCC Legit in Canada?

With a long operation history of 13 years, BTCC boasts an impressive user base and a stellar track record. As one of the oldest exchange around the world, BTCC puts a strong emphasis on conducting business in various countries and regions under the premise of lawfulness and compliance. Currently, BTCC has obtained regulatory licences in a variety of countries.

Specially, BTCC received a crypto licence issued by the Financial Crimes Enforcement Network (FinCEN) in the USA, a crypto licence issued by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC). In 2022, BTCC also received a cryptocurrency licence from the Registrar of Legal Entities of Lithuania, enabling the platform to offer crypto trading services in Lithuania and other European countries.

Is BTCC Safe?

Since its foundation in 2011, BTCC has proven to be a safe crypto exchange as it has recorded no report of fraudulent activities involving the platform’s backend or users’ accounts. BTCC crypto trading platform lays great emphasis on security, which can be evidenced by implementing compulsory know-your-customer (KYC) and anti-money laundering (AML) policies. Besides, BTCC also provides added security measures like two-factor authentication (2FA) for actions like withdrawals.

Does BTCC Require KYC?

Yes, to strength  security and meets regulatory requirements, BTCC users must complete the Know Your Customer (KYC) procedure before using BTCC products. During this procedure, users are required to submit valid identification documents and a facial recognition scan.

Can Canadian Investors Buy Cryptos on BTCC?

Of course, BTCC is legit in Canada as it has already received a crypto licence issued by the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC). Canadian traders can log in BTCC to trade cryptos with highest security level and most competitive fee.

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