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The USA is taxing every trade. In Canada (according to my accountant, at least), cryptocurrency gains are only taxable when "realized" by selling into fiat (capital gains), or spending on goods and services (income). Until that point, they are considered intangible assets and not subject to tax. A USA/non-USA (or taxable trades vs only fiat trades) switch feature would be nice, to account for the different approach to taxation.

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>In Canada (according to my accountant, at least), cryptocurrency gains are only taxable when "realized"

I'm not 100% sure about this point. The issue was raised to me before when I was looking into it— crypto-currencies may fall under barter tax law.

https://www.taxtips.ca/personaltax/barter.htm

https://www.canada.ca/en/revenue-agency/news/newsroom/fact-s...

https://www.canada.ca/en/financial-consumer-agency/services/...

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I will trust my accountant; he is after all, on the hook for how it is reported.

Thanks for posting the links! Taxtips.ca is not an official source, and note they use a ton of "may" be this and "might" be that. I will ignore that page, since they clearly do not know and are not the CRA.

The Canada.ca link is consistent with what my accountant said -- when you use crypto to purchase goods or services, it is treated as income (just like bartering), taxable in equivalent CAD value at the time of the transaction. Trading crypto for other crypto is _not_ a goods or service, since crypto is treated as an intangible asset or commodity.

The third link is also consistent with this view:

"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."

In order to be considered a "gain" or a "loss", according to my accountant, the commodity must be realized into fiat money. "Selling or buying" means selling into fiat or buying with fiat. "Bartering" means trading for goods or services -- crypto is not considered to be goods or services.

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>In order to be considered a "gain" or a "loss", according to my accountant, the commodity must be realized into fiat money. "Selling or buying" means selling into fiat or buying with fiat. "Bartering" means trading for goods or services -- crypto is not considered to be goods or services.

Thanks for the extended update!

That's very interesting! I have been hesitant to take advantage of some potential gains because of the burden of maintaining a record of every inter-coin transaction.

If your accountant is correct, then that's a load off—and a major advantage.

It really is a brand new asset class, then.

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I definitely wouldn't advise you do otherwise.

I just thought I'd pop that information out there because it's not clear to me whether or not the coin-to-coin trade falls under barter like making goods&services purchases does. Really, in case there are other Canadians like me who are doing their own taxes this year and have to include these kinds of items for the first time.