Yes, the Canada Revenue Agency (CRA) treats cryptocurrency as a capital property, which means you owe capital gains tax when you sell, trade, or exchange crypto at a profit. When your Bitcoin, Ethereum, or other digital assets increase in value and you dispose of them, you must report 50% of the gain as taxable income (as of 2024, though this rate may change). Even exchanging one type of crypto for another counts as a disposal event, triggering a capital gains tax obligation. If your crypto holdings have declined in value, you can use those losses to offset other capital gains. Unlike stocks or real estate, cryptocurrency doesn't fit neatly into traditional asset categories. The CRA views it as intangible property, not currency. This distinction matters because: - Every buy-and-sell triggers a capital gain or loss calculation - Trading one crypto for another is a taxable event (not a tax-free swap) - Mining or staking rewards are treated as income, not capital gains - Purchasing crypto with Canadian dollars is not a taxable event If you buy 1 Bitcoin at $30,000 and sell it at $65,000, your capital gain is $35,000.
No, simply owning crypto is not taxable. You only owe capital gains tax when you sell, trade, or exchange it for something of value. Holding Bitcoin or Ethereum without selling does not trigger a tax event.
Yes, trading one cryptocurrency for another (like Bitcoin to Ethereum) is a taxable event in Canada. The CRA treats it as a disposal of the first asset at fair market value, even though you didn't convert to Canadian dollars.
You can reconstruct your transaction history using blockchain explorers, bank statements, or email confirmations from the exchange. If records are genuinely unavailable, you may need to make a reasonable estimate and consult a tax professional about disclosure options.
Yes, capital losses from crypto can offset capital gains from any source (stocks, real estate, etc.). If losses exceed gains in a year, you can carry them back three years or forward indefinitely to reduce future taxes.
Yes, rewards from staking or mining are reported as regular income at their fair market value on the date you received them, not as capital gains. This is usually taxed at a higher rate than capital gains.