The CRA have advised that Canadian taxpayers are liable for taxes on crypto.  Crypto isn’t considered to be a legal tender currency, however, it is treated as a commodity.

Any income from transactions related to cryptocurrency is generally treated as business income or as a capital gain, depending on the circumstances.  Normally, business income is 100% taxable, whereas capital gains are 50% taxable.

If you are treating your cryptocurrency as capital gains/loses, you will file capital gains on the Schedule 3: Capital Gains (or Losses) form.  If you’re reporting your cryptocurrency as business income, you’ll report it using T2125 Statement fo Business or Professional Activities.

‍What is Cryptocurrency?

Cryptocurrency is a virtual or digital currency designed to work as a medium or exchange. It is sometimes also referred to as a crypto asset or altcoin and is used as a medium of exchange for goods and services between the parties who agree to use it.  

Here are examples of crypto transactions that are taxable in Canada:

• Trading cryptocurrency for cryptocurrency
• Selling cryptocurrency for fiat such as CAD
• Using cryptocurrency to purchase goods or services
• Making a sale or gift of cryptocurrency

If you hold more than one type of cryptocurrency in a digital wallet, each type of cryptocurrency will be considered to be a separate digital asset.  Each asset must be valued separately. For example, a Bitcoin is valued separately from a Litecoin.

For more information, visit: 

Guide for cryptocurrency users and tax professionals - Canada.ca

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