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Welcome to my padlet on digital currency.

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Welcome to my padlet on digital currency.

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Digital currency is a type of currency that has no physical form and only exists in digital form. Digital currencies include virtual money and cryptocurrency

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This website explains that how the trend have shifted within the last 10 years in Canada about going cashless and using digital money. Last year people used cash for 1 in 3 transactions. The invention of bitcoins and modern currency has provided some people a way to save their black money and transferring it illegally at any part of the world without paying any tax .

I choose to include this website because it contains the information about the digital security of the money and the use of private digital currency such as bitcoins . Bitcoins are not market specific or safe to have because they keep fluctuating on their prices from high to low rate per bitcoin

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We're taking note

Research is just beginning, but the idea of a digital currency issued by central banks makes some sense. In theory, it could provide the safety of cash, with the convenience of modern electronic payments.

It could take many forms, but two broad approaches are

value-based-people transfer money from their bank account to a card or a phone app; or

account-based-people and businesses can open an account at the central bank.

Either way, payments made using a central bank digital currency could allow payments to remain

private to the parties involved, just like cash; but

traceable to law enforcement, just like bank accounts.

Central bank digital currencies could give consumers more choice while maintaining competition among financial service providers like banks-the way cash does now. Depending on their design, they could even act as a backup if other payment methods become temporarily unavailable.

Basically, central bank digital cash would act like current electronic payment methods. Only difference: it wouldn't be tied to a commercial bank the way bank accounts and debit cards are.

Rest assured, though, that even if we were to issue a digital currency, we wouldn't stop printing cash. We will supply highly secure bank notes for as long as Canadians demand them.

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Research is just beginning, but the idea of a digital currency issued by central banks makes some sense. In theory, it could provide the safety of cash, with the convenience of modern electronic payments.

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In this website it is shown how cryptocurrency  (bitcoin) came into existence on 9 January 2009 and now how people are crazy for this. This was one of the main step towards the cashless society and digital currency.
Cryptocurrency is  Irreversible which means ,After confirmation, a transaction can‘t be reversed. This is the fastest and the safest way to transfer money anywhere in the world. Digital currency  was the great success in the society which  generally boosted the economy of most of the countries with a great success.

I choose this website because it covers more about the invention and success of this digital currency. How it boosted the  economy  of Canada and other countries.

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What is Cryptocurrency? [Everything You Need To Know!]

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What Is Cryptocurrency: 21st-Century Unicorn – Or The Money Of The Future? TL;DR: Cryptocurrency is an internet-based medium of exchange which uses cryptographical functions to conduct financial transactions. Cryptocurrencies leverage blockchain technology to gain decentralization, transparency, an…

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Here it is shown that Digital currencies are not supported by any government or central authority, such as the Bank of Canada.Financial institutions, such as banks or credit unions, don't manage or oversee digital currency. Unlike traditional ATM, they are not connected to your bank, credit union  network. So bank or other institution can charge tax or extra money for using bitcoins as they are private.

I choose this website because it has show the risk of using of using the bitcoin and the terms which are connected with digital currency and government laws for using digital currency .

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This page is about cryptocurrencies, which are not issued or governed by a government or central bank.

Digital currency is electronic money. It's not available as bills or coins.

Cryptocurrencies are a type of digital currency created using computer algorithms. The most popular cryptocurrency is Bitcoin.

No single organization, such as a central bank, creates digital currencies. Digital currencies are based on a decentralized, peer-to-peer (P2P) network. The "peers" in this network are the people that take part in digital currency transactions, and their computers make up the network.

Using digital currencies

You can use digital currencies to buy goods and services on the Internet and in stores that accept digital currencies. You may also buy and sell digital currency on open exchanges, called digital currency or cryptocurrency exchanges. An open exchange is similar to a stock market.

To use digital currencies, you need to create a digital currency wallet to store and transfer digital currencies. You can store your wallet yourself or have a wallet provider manage your digital currency for you.

You need a "public key" and a "private key" to use your wallet. Keys are made up of a random sequence of numbers and letters.

Public keys are used to identify your wallet.

Private keys are used to unlock your wallet and access your money. Private keys should be kept secret.

All transactions are recorded to a public ledger or "blockchain" that everyone can see.

Digital currencies are not a legal tender

Digital currencies, such as Bitcoin or other cryptocurrencies, are not legal tender in Canada. Only the Canadian dollar is considered official currency in Canada.

The Currency Act defines legal tender.

Legal tender is defined as:

bank notes issued by the Bank of Canada under the Bank of Canada Act

coins issued under the Royal Canadian Mint Act

Digital currencies are not supported by any government or central authority, such as the Bank of Canada.

Financial institutions, such as banks or credit unions, don't manage or oversee digital currency.

Automated exchangers (Bitcoin ATMs)

Automated exchangers are commonly referred to as Bitcoin ATM s. They are vending machines that allow you to insert cash in exchange for bitcoins, and in some cases bitcoins for cash.

Unlike traditional ATMs, they are not connected to your bank, credit union or the Interac network. You may be charged a transaction fee for using a Bitcoin ATM. Shop around as exchange fees vary and you may be able to get lower rates elsewhere.

Generally, when you use a Bitcoin ATM, the machine:

reads the bills you insert

converts the amount into an amount of bitcoins

sends the equivalent of bitcoins to the Bitcoin address you enter

How tax rules apply to digital currency

Tax rules apply to digital currency transactions, including those made with cryptocurrencies. Using digital currency does not exempt consumers from Canadian tax obligations.

This means digital currencies are subject to the Income Tax Act.

Buying goods or services using digital currency

Goods purchased using digital currency must be included in the seller's income for tax purposes. GST/ HST also applies on the fair market value of any goods or services you buy using digital currency.

Buying and selling digital currency like a commodity

When you file your taxes you must report any gains or losses from selling or buying digital currencies.

Digital currencies are considered a commodity and are subject to the barter rules of the Income Tax Act. Not reporting income from such transactions is illegal.
Learn more about the Canada Revenue Agency's reporting requirements for digital currencies.​

Risks of using digital currency

Using digital currency has certain risks.

You may have fewer protections

You may not have access to a complaint-handling procedure like you would with other payment methods, such as debit and credit cards.

Even if you use a wallet provider to help you manage your digital currency, the provider does not have to help you get your funds back if something goes wrong with your transaction.

Your deposit is not insured

It's your responsibility to protect your digital currency wallet.

Federal or provincial deposit insurance plans don't cover digital currency.

For example, the Canada Deposit Insurance Corporation only covers eligible deposits in Canadian dollars at member financial institutions if the institution fails.

If the currency exchange or wallet provider that has your digital currency fails or goes bankrupt, your funds won't be protected.

Your investment may be high risk

Digital currencies can be risky investments because their value can change quickly. The value of a digital currency can increase or decrease over a very short period of time. Such changes in value can be difficult to predict.

When you exchange your digital currency for traditional currency, such as the Canadian dollar, it may be worth less than when you bought it.

You may have a hard time exchanging your digital currency

Digital currencies can be difficult to buy and use. You may not be able to exchange them easily for cash or to purchase goods and services.

Merchants don't have to accept digital currencies as payment. They don't have to exchange digital currencies for traditional currencies, such as the Canadian dollar.

You may be exposed to fraud

Digital currencies may be vulnerable to fraud, theft and hackers.

All transactions are recorded to a public ledger or "blockchain". The blockchain may include information such as transaction amounts, wallet addresses and the public keys of the sender and recipient.

Digital currencies are also sometimes used to support illegal activities.

Transactions are not reversible

Purchases and transactions made with digital currencies are not reversible.

This means:

you can't reverse the charges if you didn't receive the product

you can't get your money back unless the seller agrees

you might not be able to stop a payment

Tips for using digital currency

Here are a few tips to help you protect yourself when using digital currency.

Protect your wallet

Take steps to protect your wallet:

keep your wallet, and any backups, in a safe place

encrypt your wallet using encryption software

encrypt any copies you make or online backups

set a password to help prevent thieves from withdrawing your funds

use a strong password that contains letters, numbers and symbols

Know the merchant's refund, return and dispute policies

Before you make a purchase, find out:

what the exchange rate will be

if refunds are available

if refunds will be processed in digital currency, Canadian dollars or store credit

how to contact someone if there's a problem

Wait for multiple confirmations before completing a transaction

It can take 10 minutes or more for a digital currency transaction to be confirmed. Confirmation happens when users on the network verify the transaction. During that time, a transaction could be reversed and you could lose your funds to a dishonest user.

Understand what the actual costs will be

Find out if there are any mark-ups or other fees. Find out what will happen if the rate changes before the exchange is completed.

Think about the future

Consider what will happen if you fall ill or die and can no longer access your wallet.

If no one knows the locations and passwords of your wallets when you are gone, the funds can't be recovered.

Consider having a backup plan for your peers and family.

Related links

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personal finance; consumer protection; currency; banking; income tax; taxes

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This page is about cryptocurrencies, which are not issued or governed by a government or central bank. Digital currency is electronic money. It's not available as bills or coins. Cryptocurrencies are a type of digital currency created using computer algorithms. The most popular cryptocurrency is Bitcoin.

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This website shows how cryptocurrency is taxed in Canada. It says if you are making profit from bitcoins than you need to pay the tax and if you are not selling your bitcoins on official way that a person can get free from paying tax but than there will be many problems which he need to face after breaking the law.

I choose this website because it is showing the consequences of not paying tax and breaking government law. Than to be aware from this people need to take advice from the experienced accountant to play on safe side.

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**Note, I am not an accountant, nor am I an expert on cryptocurrencies. You should seek the advice of an accountant with experience in cryptocurrencies if you have any serious questions or concerns.
With the explosion of Bitcoin, Ethereum, and whatever other cryptocurrencies that currently exist or will come to exist, many people are starting to invest. These products aren't exactly new, but they've been making headlines as of late for their huge gains (and losses).

If you invested early, you could have easily become a millionaire. As with any hot investment, many Canadians are trying to jump on the bandwagon so they too can make a fortune. Regardless of how much profit these investors make, they're going to have to eventually deal with taxes. Below you'll find some common questions and scenarios when it comes to cryptocurrencies in Canada and how to deal with them. If you're new to cryptocurrency, be sure you read this post on the 7 things you need to know about cryptocurrency before you start investing.

How is cryptocurrency taxed in Canada?

Cryptocurrency is taxed like any other investment in Canada. 50% of the gains are taxable and added to your income for that year. Let's say you bought a cryptocurrency for $1,000 and sold it later for $3,000. You would have to report a capital gain of $1,000 (50% of $2,000) which would be added to your income and taxed at your marginal tax rate.

Note that the above scenario applies to normal buy and hold investors. If you're a high volume trader e.g. someone who holds cryptocurrencies for a short period of time or day trades them, the CRA may consider it a business and you'll have to file your taxes accordingly.

Trading cryptocurrency in your TFSA and RRSP

With any potential capital gain, investors will always try to shelter themselves from taxes. The next logical question people ask is can I trade cryptocurrency in my TFSA and RRSP?

No, you can't. Nor can you transfer any Bitcoins you currently have into your TFSA or RRSP. Cryptocurrencies operate on their own exchange which does not tie any accounts which are tax friendly.

Buying goods or cryptocurrencies with cryptocurrency

Here's where things get a touch complicated. You're required by law to keep records of your trades. If you didn't keep records, you need to make your best guess and hope the CRA doesn't audit you.

These records are vital due to the capital gains you make. Now keep in mind that capital gains can apply in more than one circumstance.

Let's say you bought 1 Bitcoin for $100 but it has a current market value of $15,000. You decide to make renovations to your home and the contractor agrees to trade his services which are normally worth $15,000 for 1 Bitcoin.

In this case, both parties are liable for taxes. The original Bitcoin owner would pay capital gains on $7,450 (50% of $14,900) while the contractor would still need to report business income of $15,000. The CRA covers the details of taxes for this transaction in this post .

When trading entire amounts, things are easy. However, if you purchase cryptocurrencies at various times at different prices, you need to log all those transactions and calculate your adjusted cost base when selling later.

Moving cryptocurrency from one wallet to another

If you're simply moving your cryptocurrency from one wallet to another e.g. from Coinbase to GDAX or your own wallet then it would not be a taxable event as long as you haven't sold any of your cryptocurrency during the process.

That being said, there might be some tax implications . . . sort of.

Let's say you paid a $10 transfer fee, well that would be a transaction cost which you could deduct from your capital gains later. The same applies to any fees you incur when you buy or sell your crypto.

What if I don't report my cryptocurrency gains?

You'd be breaking the law, it's called tax evasion which is a crime that could get you sent to jail. The CRA likely won't go as far as sending you to jail, but they do want to ensure that they're getting their cut.

If you fail to report your taxes or you file incorrectly, the CRA could charge you penalties and interest later which could cost you a fair amount of money. Considering how big of a deal cryptocurrencies are right now, there's a good chance that the CRA is keeping an eye on things.

You may think that these transactions can't be traced back to you, by usernames exist and so do the exchange records.

Final word

How is cryptocurrency taxed in Canada is not an easy question to answer. If you're unsure about how to handle your taxes, speak to an accountant who has experience with cryptocurrencies who can guide you through the process or file your taxes on your behalf. Canada's tax system is fair, don't try to cheat it unless you enjoy committing fraud.

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Note, I am not an accountant, nor am I an expert on cryptocurrencies. You should seek the advice of an accountant with experience in cryptocurrencies if you have any serious questions or concerns.

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Canadian police have warned the public about getting caught up in Bitcoin scams and to exercise some caution when investing their money in cryptocurrency.

It has been an interesting year for crypto scams and controversies with some of the most famous names in the world such as Floyd Mayweather and DJ Khaled getting caught up in the affray. However, it is the online crypto-hackers you have to watch.

Canadians Keeping Track on Bitcoin Scams

The police in Edmonton, Alberta, have warned their local populous in regards to the rise in Bitcoin scams that are using sophisticated methods to part potential investors and their cash. Edmonton Police informed the public on Wednesday that crypto scammers are using more unique ways than ever before so investors need to remain vigilant.

The police mentioned in their statement that reported cases of identity theft and fraud have dramatically risen between 2013 and 2017 by almost 90% with an increase of nearly 10% in 2018 alone.

While cash and gift cards were the main avenues of online fraudsters in recent years, the growing trend of Bitcoin scams shows that crypto is now the currency of choice for modern-day crypto-hackers.

Constable Tuyen Nguyen of the Edmonton Police Service (EPS) outlined some of the problems that potential crypto investors face by saying:

"What has evolved is the method of payment demanded by fraudsters. While gift cards were once the preferred payment of choice, fraudsters are now increasingly demanding payment in other forms such as bitcoin and e-transfers."

Using Crypto ATM Machines to Convert Cash to BTC

One of the main lines of attack from crypto scammers is to audaciously act as police officers and even tax collectors to strong-arm victims to convert their cash into Bitcoin at crypto ATM machines. One the cash has been converted into Bitcoin it is extremely difficult for authorities to track down the assailants.

Constable Kyle Pepper of the EPS has warned that some Edmonton inhabitants have already lost money in this type of scam. He told reports on Wednesday:

"It's a very hard fraud to investigate given that after the money has been transferred, we can't freeze the funds that are in the machine because it's already been converted. It's unfortunate. There's been a lot of people that have lost a lot of money."

The Edmonton Police Service are currently creating a brochure and adverts to inform local residents of the potential Bitcoin scams across multiple languages to help tackle the ongoing problems.
Featured image from Shutterstock.

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Canadian Police Warn Public About Emerging Bitcoin Scams

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Canadian police have warned the public about getting caught up in Bitcoin scams and to exercise some caution when investing their money in cryptocurrency. It has been an interesting year for crypto scams and controversies with some of the most famous names in the world such as Floyd Mayweather and DJ Khaled getting caught up in the affray.

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I this video provided information is about how going cashless can help the country to boost its economy. Because most of the people who work for cash  or earn cash don't pay taxes and  which literally decreases the economy.So to overcome this government welcomed digital currency which can overcome corruption by tracking where people are spending money .

I choose this video because this shows the need of bringing digital currency to handle corruption and the betterment of the society.

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Bank of Canada wants Digital Currency in order to Track how People Spend Money

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This video shows the comparison between countries about their economy by improving the technology . This comparison shows the advancement required for Canada according to Sweden and china as the are pushing towards the digital currency .

I choose this video because there is a debate between how cryptocurrency can help in trading and in future going cashless but its effect also and relation with different countries.

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This video shows that how Canadian tax agency is targeting the bitcoin users by their transactions and keeping an eye on their account to keep them down the road.
Also talk about some websites which sells bitcoins online and from which most of the are fraud.

I choose this video because it shows how Canadians are being targeted online by different websites for their account information and encouraging them for using and purchasing bitcoin etc illegally.

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Canadian Tax Agency Targets Bitcoin Users | BTC Tx Volume Plummets | $200K Fraudsters

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This video shows that how the cryptocurrency  first came in Canada  and how it was so successful here. It also shows how the shops and big industries started accepting bitcoins for trading in a legal way to promote a way towards digital currency.

I choose this topic because this video illustrate the use and profit of using bitcoin and how it was a great success in Canada. On comparison to other videos this video was short but was effective and informative.

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World's First Digital Currency ATM Opens in Canada

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This picture shows how Canadian banks worked to decrease the cash currency and promote the digital currency to have a track on account of public by bank to decrease corruption also .This decision was taken openly and with government.

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This picture shows how digital money have takeover bank currency with a great margins . Which shows the believe of people towards the digital currency and its profits.

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What did you learn about your topic that surprised you the most?

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What did you learn about your topic that surprised you the most?

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The best thing which i learned about my topic was the use and value of bitcoin. No one may have imagined that the value of 1 bitcoin can reach up to more than 10k. And than the success of digital currency in Canada.

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Provide a real-life example of how this topic is relevant or interesting for you?

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Provide a real-life example of how this topic is relevant or interesting for you?

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If a person want to transfer his money than back in time he needs to go to bank and do some paperwork which was very long process but know with digital currency you can do it with your mobile within few seconds.

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If you could pass on your knowledge to a family member or friend, what do you think is the most important thing to pass on?

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If you could pass on your knowledge to a family member or friend, what do you think is the most important thing to pass on?

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The most important thing which i will pass is never try to break the law which is set by government for digital currency for use of bitcoins and other cryptovurrency and never trust on fraud websites which can make them fall in illegal works. And whenever doing work with money stay alert and attentive .