Where Is the Best Place to Hold Crypto in Canada?

Published: April 22, 2024 | Last Updated: April 27, 2024

Markos Koemtzopoulos

Markos Koemtzopoulos is the founder and main writer of ElementalCrypto. He has been a lecturer at the University of Nicosia on cryptocurrencies and DeFi and has taught two courses on crypto and blockchain technology.

In this post, I will walk you through where is the best place to hold your crypto if you live in Canada. 

As a Canadian you have three options when it comes to where you store your crypto

  1. The first is to use a wallet that you control
  2. Secondly, you can use a crypto exchange that you trust
  3. Thirdly you could just invest in an Exchange Traded Fund and not worry about custody. 

Let’s take a close look at each of these options

1. Best Wallets to Store Your Crypto in Canada

If you own a sizeable amount of crypto assets then you are better off using a digital wallet to store them. 

What is a crypto wallet?

A crypto wallet is a piece of software that communicates with blockchains and can sign a transaction with a special password called a private key. Think of it like a browser for blockchains. Like a browser, it can request data, e.g. how much money does this person have? However, It can also send messages to the blockchain. It signs these signs with a private key. For example, it might say Please send Bob 3 BTC, signed xyz. 

In contrast to crypto exchanges when you store your crypto in a wallet you are responsible for the private keys. These are generated in the form of 12-25 keywords known as a seed phrase. Using an algorithm you can derive the private keys from the seed phrase. Check out my explanation of Bitcoin and what a crypto address is for more.

There are two types of non-custodial wallets

  1. Software wallets
  2. Hardware wallets

Software wallets

A software wallet is a mobile app or desktop app that you download to your device. These types of wallets are known as hot wallets or online wallets because they are connected to the internet. And because they are connected to the internet they are more accessible to hackers. So if you use a software wallet you don’t want only have one. Check out my post on whether you should Have Multiple Wallets

And you shouldn’t store your life savings on them. 

The benefits of using a software wallet are

  • They are free
  • They plug into DeFi better
  • You don’t need an extra device as you can download the wallet on your mobile device
  • They include many features such as staking, swap exchange, fiat onboarding, and more

Some popular hot wallets are:

  • Exodus: nice interface and support for multiple cryptocurrencies
  • Cake Wallet: Primarily built for Monero but supports other coins and tokens as well. It is well regarded within the Monero community who are sticklers for quality
  • Guarda: includes a card which is rather expensive
  • Metamask: Popular with Ethereum and ERC-20 holders. It does not support bitcoin and other major blockchains though.
  • Atomic Wallet: I really liked the user experience on this one but it got hacked. See my review of Atomic wallet for more
  • Trust Wallet (By Binance)
  • Coinbase Wallet. See the difference between Coinbase and Coinbase Wallet here.

Cold Wallets or Hardware wallets

Hardware wallets are physical devices that cost between $50-200 depending on which model you get. 

Ledger Nano X
A ledger wallet

These types of wallets are also known as cold wallets because they are not connected to the internet. 

Storing your digital assets in a cold wallet is considered the safest way because it’s extremely difficult to hack them. 

While they are not connected to the internet permanently you do need to hook them up to your phone or laptop using a cable or Bluetooth connectivity. 

The difference is that you need to press buttons on the physical wallet to confirm transactions and this is what makes it very hard for hackers to access your codes.

The two most popular hardware wallets are

  • Ledger: popular models include the Ledger Nano X and Ledger Nano S. Ledger also has a feature that allows you to back up your private keys in case you lose them. Most crypto investors don’t like the feature because they feel it is a back door. You can read my deep dive on Ledger where I analyze this feature in more detail.
  • Trezor wallets: The Trezor model t is the most popular.

The major drawback of using crypto wallets is that you have to manage your private keys yourself. This means that if you lose them or someone steals them there is no way to recover your funds. If this sounds scary to you then you might want to opt for a crypto exchange

2. Storing your crypto on Canadian crypto exchanges

A crypto exchange is a platform that allows you to buy and sell cryptocurrencies. 

However, most people leave their crypto assets on the exchange once they buy them. 

The risk with doing that is that if the exchange goes bust or absconds with your money (see Quadriga CX Canda crypto exchange scandal) then there is no way to get it back. Unlike the Canadian dollars in your bank account, Cryptocurrencies are not insured by the Canada Deposit Insurance Corporation (CDIC) or the Canadian Investor Protection Fund (CIPF).

Another risk is if there is a government clampdown as there was with the trucker protesters there is no way for you to access your funds.

In any case, if you are going to store your assets on a crypto exchange these are the ones I would recommend.

1) Coinbase

Coinbase places a lot of emphasis on security with the majority of user funds stored offline in cold storage. However, the most useful feature of Coinbase is its Coinbase Vaults. This a free cold storage solution with a time delay on transactions which means you will be notified in the meantime should someone try to remove your funds. You can find out more about Coinbase vaults here. 

Some other reasons that I like Coinbase are 

  • Low trading fees (tip: use Coinbase Advanced for lower fees. You can turn it on under settings)
  • Good customer support
  • Deposit via Interac e-transfer, wire transfer, or debit card 
  • Easy-to-use interface
  • Has the requisite permits from the Ontario Securities Commission. See is Coinbase Legit in Canada
  • 250+ digital currencies to choose from

2) Kraken

If you don’t use Coinbase use Kraken. Here are a few reasons why

  • It’s never been hacked
  • If you search on Reddit and other forums you will see that the majority of people are happy with it
  • It has a Money Services Business license in Canada
  • Kraken is known for its security features: You can set up 3 two-factor authentication codes. One for signing in, one for funding, and one for changing the security settings. Here too you can set a 48 hours time delay for withdrawals for added security
  • They have just launched their own hot wallet
  • Offers margin trading (though this is not available for Canadian residents)

3) Crypto.com

This is also a very popular crypto exchange. Based out of Singapore Crypto.com is a well-established brand in the crypto space.

  • Easy-to-use app with an intuitive user experience
  • Its main selling point is that it offers you a prepaid card that pays you back 1% in crypto when you use it.
  • Security measures include storing a large proportion of funds in cold storage and two-factor authentication.
  • Supports multiple payment methods including a debit card and Interac e-transfer

4). Canadian exchanges with headquarters in Canada

If you are feeling patriotic you may want to consider exchanges that are based in Canada. These are smaller in size and therefore riskier in my opinion

  • Wealthsimple crypto: This is a robo-investing platform that automates trades for both crypto and more traditional assets such as stocks. 
  • NDAX: also popular in the Canadian market,  NDAX offers more than 30 cryptocurrencies and allows you to stake them to earn a yield. 
  • Newton: this is not an exchange but rather a brokerage but it is backed by the founder of Shopify so expect great things

5) Best place to hold bitcoin in Canada

Canada is a unique market in that there are a lot of centralized solutions for you to store your crypto while you keep custody of your keys. 

If you are only interested in storing Bitcoin then check out the following

Bitcoin Well

They operate a network of Bitcoin ATMs but also have an app with a user-friendly interface where you can store and manage your Bitcoin.

This solution is similar to a wallet in that you manage your private keys.

What is unique about Bitcoin Well is that they allow you to spend your Bitcoin on gift cards and pay bills

Bull Bitcoin

This is a self-custody solution that allows you to use Bitcoin as a means of payment.

This means you can send Bitcoin to someone to pay them and Bull Bitcoin will convert this to fiat currency to pay them. 

​Beaver bitcoin 

Beaver is another non-custodial solution for those seeking to store their Bitcoin.

The main benefit of using them is that you can do weekly recurring buys.

Be aware that Beaver charges higher fees are sizable at 1.5%.

MyBTC.ca

for Canadian users who want to buy Bitcoin with Flexipin, this is a good solution.

This too is similar to a wallet in that you are responsible for your private keys. 

3. Bitcoin Exchange Traded funds

Bitcoin ETFs launched in Canada way before they did in the United States. An ETF is a basket of securities that tracks the performance of an underlying index. In this case, if you buy shares of a Bitcoin ETF it is like you own Bitcoin. Except that you don’t need to interact with a crypto exchange or wallet. Instead, you just use your preferred broker to buy the ETF. There are multiple Bitcoin ETF issuers to choose from. Some popular ones are

  • Purpose Bitcoin ETF Class A
  • Fidelity Advantage Bitcoin ETF
  • CI Galaxy Bitcoin ETF (USD)
  • Evolve Cryptocurrencies ETF which as the name suggests includes multiple cryptocurrencies
  • BetaPro Inverse Bitcoin ETF

FAQs

What is the safest crypto wallet in Canada?

Physical devices such as the Ledger Nano S and Trezor Model T are considered the safest as hackers cannot access the devices remotely.

If you are afraid of losing your device and seed phrase then consider using a renowned crypto exchange such as Coinbase or Kraken. Both of these are known for their security and allow you to set time delays for withdrawals as an added security measure.

Another alternative is to buy a crypto ETF from your broker.

Which platform is best for crypto in Canada?

If you are looking to trade large-cap cryptocurrencies then choose one of the international exchanges such as Coinbase, Kraken, or Crypto.com. If you are looking to trade small caps then consider using Kucoin which is allowed to operate in Canada and offers more than 800 cryptocurrencies. 

Where is the best place to hold crypto?

The most secure place to store crypto is in a cold storage hardware device. The second best place is to use a vault on a large exchange such as Coinbase. Smaller exchanges and digital wallets should be used for trading and for storing smaller amounts respectively

Are crypto wallets legal in Canada?

There is currently no regulation against crypto wallets in Canada. Most hot wallets, even if they are developed by an exchange, brand themselves as decentralized meaning it’s just a bunch of code that everyone has access to and can use for free. For this reason, crypto wallets do not require registration. You don’t even need to provide an email address. The only time you need to do this is if you want to onboard with fiat such as Canadian dollars, to buy digital currency.

Can I use Trust Wallet in Canada?

Trust Wallet was developed by Binance which is banned as a crypto exchange in Canada. However, there are no rules against using Trust Wallet itself. 

Is crypto taxable in Canada?

Yes, Canadian crypto users are required to pay capital gains tax on their profits from buying and selling crypto. Check out how to calculate crypto gains and what is a cost basis in crypto for amore on this topic.

Up next

18 Best Canadian Crypto Exchanges

Best Canadian Crypto Exchange

In this post, I will walk you through the top trading platforms to help you find the best Canadian crypto exchange. 

1. Shakepay

If you only care about Bitcoin and Ethereum then Shakepay could be an option for you. Shakepay’s nifty app is easy to use and if you use their prepaid visa card you can earn 1% in BTC on whatever you earn. Based out of Montreal the exchange has been around since 2015 and has more than 1Mn customers.

2. NDAX

NDAX is considered one of the best cryptocurrency exchanges in Canada. It is known for it fast deposit and withdrawal processing and for its low fees and spreads. 

3. Bitcoin Well

Why Bitcoin Well: Originally a Bitcoin ATM operator Bitcoin Well offers its users self-custody of of their Bitcoin. The company is publicly traded and takes a 1% fee when you buy or sell bitcoin on their platform or ATMs. Their main pitch to Canadian investors is that by buying their stock they can get exposure to Bitcoin without being exposed to price fluctuations because Bitcoin Well makes money on transactions.

See the top canadian crypto exchanges here.

Markos Koemtzopoulos is the founder and main writer of ElementalCrypto. He has been a lecturer at the University of Nicosia on cryptocurrencies and DeFi and has taught two courses on crypto and blockchain technology.

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