It’s becoming well known that Canadian banks are not so crypto-friendly. No Canadian bank will allow you to use a credit card to buy crypto. In a way, it makes sense. Canadian banks argue that they want to protect their customers from fraud. However, a credit card is borrowed money and it’s reasonable that banks don’t want you to use borrowed money to buy a volatile asset in case you can’t pay off your credit card.
Canadian banks will usually allow you to use your debit card to purchase crypto since it is your own money. However, not every Canadian bank allows this. Some Canadian banks will only allow you to use Interac e-Transfer to deposit fiat into your account on an exchange.
Usually you will have a daily, weekly and monthly limit for Interac-eTransfer. The daily limit is usually $2,000-$3,000. If you try to send more than this, it is likely the transaction will fail and you may find yourself locked out of your account. A transaction to a crypto exchange is already something banks watch closely, but when you also go over the limit, that can flag the transaction as fraud.
To avoid being locked out of your account, make sure you don’t go over your Interac limits. You can usually find your limits in your online banking account. You can go into a branch in person to increase your limits or make a transfer larger than your limit.
You may want to open another bank account elsewhere. Multiple transactions to a Canadian crypto exchange throughout the day or every day may also trigger a fraud warning even if you’re transacting under your limits. If you have more than one account, you can spread out the transactions between banks so they don’t seem as suspicious. Alternatively, call your bank and let them know that you will be making frequent transactions to a particular exchange, so that they don’t flag the transactions.
Some crypto exchanges do not allow Interac e-Transfers but will accept third party payment systems and payment gateways. Your bank may see these transactions as suspicious as well, in which case you will need to call your bank and verify it was you. We would recommend using Canadian crypto exchanges that accept e-transfer and are officially regulated, e.g. Coinsmart (use this link to claim free $20 in bitcoin).
Depositing large amounts of crypto to an exchange or simply buying it with a card can be a challenge. Many people argue that banks simply don’t want to relinquish control over people’s money. While there may be some truth to this as crypto could be a bank killer, it is most likely that banks simply want to protect your account from fraud. Banks treat crypto transactions as suspicious activity, but while they cannot stop you from depositing money to a crypto exchange, they can and will flag transactions if you go over your limits.
Some people argue that banks just see crypto as gambling but don’t understand why banks allow you to spend money on gambling sites but not crypto. The difference is that the gambling industry is regulated and crypto is not. So when banks say they are trying to protect you, they have a point. On the other hand, banks shouldn’t have a say how people spend their own money.
In general, buying crypto is easier now than ever, but banks often put up roadblocks which can be difficult to navigate. If you keep transactions under your limit and don’t make transactions every day and use officially registered crypto exchanges in Canada, then you should be able to buy crypto without issue.
