A Beginner’s Guide to Buying Bitcoin in Canada

Though concepts like blockchain technology or bitcoin sound baffling, buying bitcoin in Canada is easier than you think. If you’re new to this world and want to buy bitcoin and learn more about it. You’re in the right place! So keep reading, and let’s turn you from a nocoiner to a bitcoiner!

a bitcoin on a blue and pink paper
Photo by Moose Photos from Pexels

In this blog post, we will answer these questions:

1. What is bitcoin?
2. Is bitcoin legal in Canada?
3. How to buy bitcoin in Canada?
4. Where can I buy bitcoin?
5. I Don’t Have That Much Money, Can I Buy Bitcoin?
6. Where Can I Use My Bitcoin?
7. How to buy bitcoin at VirgoCX

What is Bitcoin, and Why is it Here?

Opinions are divided on whether bitcoin is a type of currency, payment method or a cyber bank. Nevertheless, Bitcoin is the first and most successful cryptocurrency ever created (According to CoinMarketCap, there are 6,955 different cryptocurrencies out there). It was first launched as open-source software (Nope, it’s not a real coin) and developed based on blockchain technology.

Unlike fiat currency—the money we use now, which is issued by the central government. Every transaction is recorded on the public ledger (blockchain), and everyone can see it. It ensures a higher level of transparency and immutability, which prevents anyone from forging or altering data. 

Can bitcoin substitute money? Bitcoin has the characteristics of money and can be used as a form of money among those willing to accept bitcoins. Yet, it is different from fiat currencies; the Bitcoin network could create a new global monetary system that operates based on math.

Yes, it is! According to the Financial Consumer Agency of Canada, it is perfectly legal to buy goods and services using cryptocurrencies like bitcoin in Canada. And it is also allowed to buy and sell bitcoins on an exchange or crypto trading platform. That said, tax rules also apply to digital currency transactions, meaning GST/HST will be added to the amount you pay. You are also obliged to report gains from digital currency trading.

However, bitcoin is not considered a legal tender in Canada, meaning only the Canadian dollar is the official currency of Canada.

How to Buy Bitcoin in Canada

In a nutshell: 

1. Open an account at a regulated crypto trading platform like VirgoCX

2. Get verified (this is to protect your funds and identity )

3. Fund your account with as little as 100 Canadian dollars

4. Buy bitcoin

It is really this simple. But if you want to know more about different ways of buying bitcoin in Canada and learn more about buying and selling bitcoin. Keep reading.

Where Can I Buy Bitcoin?

Cryptocurrency Trading Platform

The most convenient way for Canadians to buy and sell bitcoin is through cryptocurrency trading platforms. There are several regulated exchanges/ trading platforms which make crypto trading fast and simple for Canadians. We highly recommend you to do your due diligence when choosing a platform that works best for you. And there are several things to consider when making that decision:

Security 

What’s more important than keeping your information and funds secured? You should always go with the platform that provides the highest level of security for your assets. At VirgoCX, we prioritize transactions, funds and system security to protect you at every step of your trading experience. 2 Factor Authentication (2FA) is implemented for every login and password reset. Multiple layers of security measures are implemented to protect user data. In addition, we do require you to complete the KYC process to protect your identity and comply with the government’s anti-money laundering effort. 

After you buy bitcoin, you need to store it somewhere safe. You can either store it in your own bitcoin wallet or on the platform for easy trading. There are two different kinds of bitcoin wallets – hot wallet and cold wallet. A hot wallet refers to a digital cryptocurrency wallet that is connected to the internet while a cold wallet is a physical device that stores your assets offline. A hot wallet makes trading and daily transactions convenient, but it also needs added security as it is vulnerable to hacks. The cold wallet is known to be the safest way to store your bitcoin as it is impossible to be compromised(but it can be physically damaged).

Regulation and Compliance 

The banking relationship is one of the defining factors that decide whether an exchange is legitimate. Only a trading platform with solid regulatory relationships will manage to maintain their daily operations. At VirgoCX, we have multiple banking relationships that enable different funding methods like INTERAC e-transfer and wire transfer in multiple currencies. 

VirgoCX also maintains the highest standard of regulatory compliance and business conduct. We have successfully completed a financial audit, a Proof of Reserve Audit and an AML audit. The results have once again demonstrated our commitment to being a transparent, safe and trusted cryptocurrency platform. 

Fees 

Transaction/commission fee is another important feature of a trading platform. You should always check and compare the fees of different platforms and find the one that best suits your needs. For example, at VirgoCX, our offerings provide some of the lowest overall trading costs in Canada. We charge 0 trading fee, 0 deposit fee, 0.75% withdrawal fee for fiat currencies and only a minor fee for digital currency withdrawals. 

woman using a bitcoin ATM
Photo by Elise from Pexels

Did you know the world’s first Bitcoin ATM was opened in Canada back in 2013? A bitcoin ATM looks a lot like a traditional ATM machine, but they work differently. The machine allows you to buy and sell bitcoin or other cryptocurrencies but it is subject to a higher fee, which is usually between 7-15 %. And it usually sets deposit and withdrawal limits between $1000-$10,000. You certainly have other more affordable and flexible options to trade bitcoin. For example, at VirgoCX, you can start buying and selling bitcoin with as little as 100 Canadian dollars.

Bitcoin OTC (Over-the-counter)

If you want to buy and sell a large amount of Bitcoin or other cryptocurrencies. You can use OTC service. Many Canadian crypto trading platforms, including VirgoCX, offer it. We will provide you with personalized service, lock in the price and fast settlement. Read this if you want to learn more about how to buy bitcoin through OTC desks in Canada.

Mine Bitcoin

Technically, you can also earn bitcoin by mining, but that is a whole different story. For daily traders, buying and selling bitcoin on an exchange is the easiest way. 

I Don’t Have That Much Money, Can I Buy Bitcoin?

Worry not! Even though the bitcoin price has skyrocketed recently, you don’t need to buy a whole bitcoin. “Satoshi” is here to your rescue. “Satoshi” refers to the smallest unit of bitcoin and it equals 0.00000001 BTC, so bitcoin can be bought by fractions. You can buy many “Satoshi” with the money you plan to spend. At VirgoCX, you can become a bitcoin owner with as little as 100 dollars, and with the current bitcoin price (at the time of writing), that’s 0.0024 bitcoin!

screenshot from google showing bitcoin price to canadian dollars

Where Can I Use My Bitcoin?

Buy things 

Can you believe that someone once paid 10,000 Bitcoins for two pizzas, which today (at the time of writing) is worth over 433 million dollars?  Now it has become an urban myth, but that day was remembered as Bitcoin Pizza Day. The event is important because first, that’s a ridiculous amount of money for two pizzas! And second, it was the first purchase made using bitcoin, which showed bitcoin’s potential of being a new method of payment. 

Eleven years have passed since that event. Today, a growing number of businesses, including Microsoft, Wikipedia, etc. have started to accept bitcoins and other cryptocurrencies as a form of payment. You can find out more about where to spend your bitcoin as a Canadian here: Where Can Canadians Spend Bitcoin?

Donate 

If you want to give back to society while enjoying tax benefits, it’s possible too! There are many charities in Canada that accept crypto donations. For example, VirgoCX is supporting SickKids Foundation by exchanging cryptocurrency into cash donations. So if you want to make a crypto donation to SickKids, please reach out! 

Hold, Buy and Sell 

Many say bitcoin is like gold, you buy it but don’t necessarily need to spend it. That’s one way to go. And apart from treating it as a store of value, you can also buy and sell bitcoin at a regulated Canadian crypto trading platform. And apart from bitcoin, many other cryptocurrencies are also available for trading. For example, Ethereum, Tether, Litecoin, EOS, Paxos Gold, Stellar, USD Coin and Bitcoin Cash.

How to buy bitcoin at VirgoCX

Step 1: Sign up and get KYC verification

Sign up for a VirgoCX Account (Only 3 steps, then you start trading)

1). Provide an email address

2). Set up a strong and secure password

— Remember to set-up 2FA (Two Factor Authentication)

3). Verification process

Once you log into your account, click on the “Required verification” button on the right corner; Click the user verification tab in the account setting and then the verification process will begin. You will have the choice of two different methods for completing identity verification with those choices being:

Automatic verification: Jumio (Take a picture of your ID and a selfie)

or 

Manual verification: Upload PDF documents as required.

After finishing these simple steps, you are ready to go!

Step 2: Fund your account: Deposit CAD/USD

Deposit methods:

You have two options to fund your account, INTERAC e-Transfer or bank wire.

Step 3: Buy bitcoin

Quick trade

Quick trade allows you to easily buy or sell at the market price. It is specifically designed with new traders in mind and it is primarily created to cater to those looking to conduct small to medium-sized orders. It makes trading possible for every Canadian.

Advanced trade

Advanced trade is designed for experienced traders by providing the charting tool, technical analysis, recent transaction history, etc.

Fees

Enjoy the low fees with full transparency from VirgoCX! To see more details on fees, please check the “Fee” page.

Final: Store/trade bitcoin or withdraw it to a wallet of your choice.

yellow balloons with smiley faces
Photo by Tim Mossholder from Pexels

Congratulations! Now you are a bitcoiner!

Disclaimer: No Investment Advice The contents of this article are for informational purposes only and are not intended as, and shall not be understood or construed as, investment advice, financial advice or trading advice. There are substantial risks associated with the trading of cryptocurrencies and you should consult with a licensed financial advisor prior to making any trading or investment decisions. Content Not Warranted The contents of this article are provided “as is” and without warranties of any kind. You bear all risks associated with the use of the content provided including without limitation, any reliance on the accuracy, completeness or usefulness of any content available within this article.  


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