Trading Cryptocurrency in Canada in 2022 - A Beginner's Guide

What is cryptocurrency? What is bitcoin? How can I earn money trading cryptocurrency in Canada? How do you trade cryptocurrency in Canada? What is the best platform to trade cryptocurrency in Canada? Is NDAX a good platform to use? We will be answering all these questions and more! And to help you become profitable, we're offering 4 FREE bonuses at the end of this article, so keep on reading.


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Before we get started ...


Did you know that according to research published in 2018 by the Bank of Canada titled “Bitcoin Awareness and Usage in Canada,” only 5% of Canadians own Bitcoin.


Melanie Swan, a technology theorist in Philosophy at Purdue University says, “There is something new and fundamental happening in the world which could be the start of the next enlightenment period. The core of this is shifting from centralized to decentralized models in all aspects of our lives, both individual and societally.”


In this article, we will highlight the Canadian financial and cryptocurrency ecosystem and explain everything Canadians need to know to get started. We will also be sharing our review of NDAX, a powerful crypto-trading app that can be used to trade from anywhere you are.

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What is Cryptocurrency?


Cryptocurrency in its simplest form is an internet-based medium of exchange that uses blockchain technology to function. Blockchain enables cryptocurrencies to be decentralized, transparent and immutable.


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What is Bitcoin?


Bitcoin is the first-ever cryptocurrency and by far the biggest by market capitalization—meaning that the total dollar market value of Bitcoin is more than any other cryptocurrency. The supply of Bitcoin is limited to 21 million— meaning there can never be more than 21 million Bitcoin. The number of Bitcoin in circulation right now is 18.5 million.



Why should you invest in Bitcoin?


An ideal currency in a digital age like ours should have three main characteristics:


  • It shouldn't be under the control of authority so that it isn’t manipulated and printed at will.

  • The currency should be borderless so that it can be exchanged throughout the globe without the help of a middleman.

  • It should be apolitical and not in favour of a specific group of people.


A major reason to invest in cryptocurrency is the desire for a reliable, long-term store of value. Unlike fiat money, most cryptocurrencies have a limited supply, capped by mathematical algorithms. This makes it impossible for any political body or government agency to dilute their value through inflation.


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Taking a look at the Canadian Balance sheet, we can see a frightening 456% increase in the balance sheet assets to Nominal GDP growth, while this provides the economy with temporary life support, it paints a gloomy picture of the future of the Canadian dollar.



The Problem Bitcoin Solves


Bitcoin solves the problem of Inflation. With its limited supply and decentralized nature, Bitcoin makes for one of the best store-of-value assets similar to Gold. Here’s a very interesting and detailed report by Grayscale Investments LLC on ‘Valuing Bitcoin.’


Inflation and geopolitical instability are big drivers in the recent trend of companies adding bitcoin to their balance sheet. In 2020, the US companies MicroStrategy and Square have invested $425 Million and $50 Million respectively in Bitcoin.


The current pandemic that has hit the world, strengthens the case for Bitcoin even further because central banks all over the world are printing and pushing more and more money into the economy to keep businesses running and people employed.


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How can Canadians start trading Bitcoin?


The best way to get involved is to Dollar Cost Average (DCA) into Bitcoin. A common misconception is that you have to buy a whole Bitcoin. 1 BTC to CAD at the time of writing this was a little below $15,000.


You can buy part of a Bitcoin for as less as $1 depending on the exchange you’re buying from. One Bitcoin is divisible into one hundred million units called Satoshis or Sats — meaning that 1 BTC is equal to 100,000,000 Sats.



How to buy Bitcoin in Canada?


The Bitcoin network has been running securely for over 10 years now, long gone are the days when you could use your computer’s graphics card to mine some bitcoin. The good news is that you don’t need a supercomputer to own bitcoin anymore.


There are multiple Canadian exchanges available that you can use to buy Bitcoin, but before making a choice you need to look at the following points:


  • 1. Security of the platform

  • 2. Custody

  • 3. Regulation & Banking

  • 4. Closed-loop vs open-loop exchanges

  • 5. Fees


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NDAX Review


NDAX has one of the lowest trading fees/commissions among the Canada-based cryptocurrency trading platforms I have reviewed. It also has fast processing times for deposits and withdrawals. The trading fee for buying and selling is a flat-rate 0.20%. Unlike many other crypto sites, you don't pay a fee to deposit fiat. Some points worth mentioning:


  • The National Digital Asset Exchange (NDAX) is registered with the Financial Transactions and Reports and Analysis Centre of Canada (FINTRAC) and Autorité des marchés financiers (AMF) as a Money Service Business (MSB).

  • NDAX has obtained a banking relationship with a Canadian Crown-owned financial institution, with insurance protection for user funds. This is important if you want to get your money back in case the exchange is hacked, and the funds are stolen.

  • NDAX also holds the majority of digital assets, offline in cold storage which mitigates the risk of cyber hacks even further. NDAX was also able to secure banking services from the same institution so that fiat deposits don’t need to be sent offshore or held in non-regulated institutions.

  • More importantly, NDAX runs an open-loop system—meaning that users can withdraw their purchased assets to non-NDAX addresses. Personally, I thought this was a standard for any exchange but surprisingly realized that it's more of a feature.


Remember: The coins listed on NDAX are Bitcoin, Ethereum, Litecoin, Tether, XRP, EOS, Stellar, Dogecoin, Cardano and Chainlink. NDAX has a very straightforward fee structure. All deposits are free. The platform charges 0.20% trading fees which are very standard and have flat fee withdrawal fees that vary depending on the asset.

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