You can buy Bitcoin with Canadian dollars in various ways. Bitcoin exchanges, which facilitate the buying and selling of Bitcoin on a centralised platform, is the most popular method. To use them is relatively easy:
- Connect via desktop or with an app downloaded to a tablet or smartphone.
- Create an Account with Proof of ID validated
- Transfer funds via an accepted payment method such as Interac, Debit and Credit Cards
- After your funds are cleared start buying Bitcoin
- Store on your preferred Wallet, either on exchange or to your own wallet
Invariably, when selecting a method to buy and sell Bitcoin in Canada, there are several factors to consider: safety and security, platform reliability and undoubtedly transaction and payment fees.
Top 5 Canadian Bitcoin and Cryptocurrency Exchanges
Legality of Buying and Selling Bitcoin in Canada
Yes, Canadians can buy and sell Bitcoin legally and use it as payment method.
There are no restrictions on methods to acquire Bitcoin. Therefore any Bitcoin exchange, whether they fall under Canadian jurisdiction or outside at offshore locations, can be used by Canadians to buy and sell Bitcoin. There are no limitations.
The Canadian Government, however, does warn buyers and sellers that Bitcoin is not considered legal tender, as outlined on their page:
https://www.canada.ca/en/financial-consumer-agency/services/payment/digital-currency.html
Accordingly the Government clearly warns Canadians of the investment risks involved with buying and selling Bitcoin.
Methods to Buy Bitcoin in Canada
There are several ways that Bitcoin can be bought in Canada. They include: Bitcoin exchanges, brokers, Bitcoin ATMs, eWallets, Peer to Peer and online casinos.
Buy Bitcoin via Bitcoin exchange
Without doubt, the most popular method in Canada is to use a Bitcoin Exchange.
An exchange is whereby buyers and sellers place their orders on a “centralised” platform – meaning the platform is owned by a company and fees are charged. It’s therefore important to consider the reputation of the Bitcoin exchange, safety and security measures that they have, common payment methods such as Interac e-Transfer and Interac Online, and of course the ability to accept Canadian dollar.
Examples include: Binance, Gemini, and Coinbase,
Buy Bitcoin via Bitcoin broker (OTC)
OTC stands for Over The Counter which means using a broker to buy Bitcoin.
A broker will support the exchange of Bitcoin through active dialogue with buyers and sellers. Effectively, the buyer is connected to the seller of the Bitcoin via the broker. This is unlike the traditional Bitcoin Exchange, whereby buyers and sellers simply place their orders and if a price is met the exchange will be executed.OTC is a good service for buyer and sellers who wish to move large volumes of Bitcoin.
Examples include: Bitstocks, ItBit, and Circle Trade.
Buy Bitcoin via Bitcoin ATM
Bitcoin ATMs can be found in Canada. Although not as prevalent as traditional ATMs at the moment). Bitcoin ATMs allows you to buy Bitcoin by depositing your cash.
However, you must have a Bitcoin wallet established in advance for the coins to be transferred.
Some Bitcoin ATMs also allow cash to be withdrawn, but these are not many.
The process of using a Bitcoin ATM may vary from machine to machine. However, the general steps are as follows:
- Verification with your ID card.
- Select Bitcoin as the crypto to be purchased.
- Enter your cryptocurrency address for deposit.
- Select the amount of Bitcoin you want to purchase.
- Insert cash into the Bitcoin ATM
- Confirm
Typically exchange fees are quite high and the exchange rates are unfavourable when using Bitcoin ATMs in Canada.
Buy Bitcoin via eWallets: PayPal
PayPal launched in 2020 essentially a Bitcoin wallet for its users. PayPal isn’t an exchange but a payment method. There are some Bitcoin exchanges that accept PayPal to transfer CAD in return for Bitcoin that can be stored on PayPal.
Buy Bitcoin via Peer to Peer Exchange
Peer to Peer is a decentralised exchange. Buyer and sellers deal directly with other to exchange CAD with Bitcoin. Through this process, often an escrow account is used. Peer to Peer exchanges generally charge a higher fee than traditional centralized Bitcoin exchanges. The advantage of using a Peer to Peer exchange is better security and safety.
Examples of Peer to Peer exchanges include LocalBitcoins.com, Paxful and Binance
Gamble with Bitcoin at Canadian Online Casinos
Canadians can find many online casino sites that accept Bitcoin with the majority licensed in the UK or Malta. Though they are regulated and licensed at offshore jurisdictions, not all can be trusted. Research well which online Bitcoin Canadian Casinos are reputable and offer a safe gaming experience.
How To Choose a Bitcoin Exchange in Canada
It is important to choose a Bitcoin exchange carefully. We discuss some of the most important characteristics in an exchange to help you make the decision.
For beginners if you feel you lack an understanding of the process, we strongly recommend performing further research before proceeding with selecting a Bitcoin exchange.
Security
By far one of the most important aspects when choosing a Bitcoin exchange. Exchanges are at constant risk of hacks, frauds, and pump and dump schemes. Hence, read carefully the reviews of exchanges, and in general stick to the larger ones.
Features of the best Bitcoin exchanges include:
- Two-factor authentication (2FA): All the top Bitcoin exchanges have or offer 2FA. This is a method whereby the Sign In process for your account requires a combination of your password and a Confirmation Code via SMS, text message, or email.
- Cold Storage for your funds: The exchange stores your Bitcoin offline to prevent risks of online hacks.
- Proof of reserve: The Bitcoin exchange is audited to verify that the total amount of funds held by them matches the total amount liable to their customers.
Supports CAD, Bitcoin and Altcoins
Look for an exchange that accepts CAD, or the fiat currency that the deposit will be made in. Also, make sure that if you are looking to trade beyond Bitcoin, the Altcoins that you would like to trade with are available.
Liquidity
A highly liquid Bitcoin exchange will enable you to quickly buy or sell your Bitcoin. An illiquid exchange will impact the prices and speed of your transactions. Make sure your exchange offers sufficient liquidity and trading volume for fast and easy transactions.
The easiest way to check liquidity of an exchange is to refer to coinmarketcap.com and bitcoincharts.com.
Fees
Fees differ from exchange to exchange both in pricing and in calculation. Some charge a fixed flat fee while others have a variable sliding scale and decreases as the trading volume rises.
Not only, are there fees on trading but there are also fees when making a deposit. (Typically depositing in CAD incurs no fees, but other currencies do have fees in particular the less commonly traded ones).
Ease of Use
An important aspect, particularly if you are new to buying Bitcoin. Your Bitcoin Exchange should be easy to use, intuitive and with no latency. The layout should be clean and not confusing. Experienced traders will be looking for an exchange that is rich in features, charting, graphs, market depth, stop loss functions and average purchasing buying. These are very helpful, but are useless if the exchange is not easy to use.
Deposit and Withdrawal Methods
Review the methods of payment that a Bitcoin exchange accepts. There are various methods that the best exchanges offer – bank transfer, PayPal, Interac, debit and credit cards. As mentioned in the Fees section, be aware of how much they charge for using each of these payment methods.
Customer Support
Don’t be fooled into believing that all the big Bitcoin exchanges offer great customer service. This is not true. Look for exchanges that provide responsive customer support that are easily accessible 24/7. If you have any doubt as to whether an exchange has quality support perform a search on forums to read what complaints other users are discussing.
How to Buy Bitcoin in Canada using an Exchange
It can be confusing with knowing where to start with using a Bitcoin exchange. As an example, we lead you through the process of creating an account and buying bitcoin with Binance. Binance is one of the most popular and trustworthy Bitcoin exchanges in Canada.
Binance rates highly for all the characteristics of choose a good Bitcoin exchange. They are one of the largest exchanges in the world, offering great liquidity, fees are a flat rate of 0.1%. which are very competitive, the platform is extremely easy to use and customer support is responsive.
With Binance you can buy Bitcoin and various Altcoins using CAD.
Sign Up
Step 1: Click through to land at the Bitcoin exchange official site.
Step 2: Enter your email and a strong password.
Step 3: Confirm your email address.
Step 4: Enter your mobile number and complete the SMS Authentication process.
Post Sign Up Verification
Step 5: Residential address
Step 6: Country of residence
Step 7: Photo of your ID
Step 8: Selfie to verify your identity
Once your account has been verified, proceed with processing a deposit.
Step 9: In your account select Deposit Method
Step 10: Select the Currency
Step 11: Enter the amount of Deposit
Step 12: Confirm
Depending on the payment method that you have chosen, it can take up to 2 business days for the funds to clear. However, it is generally within 1 business day.
Bitcoin Market Developments in Canada
Canada ranks in the top 10 of countries that have taken up using Bitcoin as a payment method or as an investment. Not only has there been a large interest in Bitcoin, but also with Ethereum and other altcoins. What has perhaps assisted with the uptake, is the clear regulations and treatment of Bitcoin by the Government. Unlike the US, which has rather complex State laws that differ from State to State and may also contradict the Federal laws, Canada has an efficient financial system.
The fact that many exchanges offer Interac as a deposit method is indicative of the popularity of trading in Bitcoin in Canada.
