How to get a crypto debit card in Canada

You can use a crypto debit card (or crypto prepaid card) to pay for purchases in person and online like a regular debit card. Instead of withdrawing CAD from a bank account, a crypto card makes payments from a crypto wallet using fiat currency that’s been converted from cryptocurrency. Here’s where to get a crypto debit card in Canada.

Where to get a crypto debit card or prepaid card in Canada

How does a crypto debit card work?

A crypto debit card is linked to a crypto wallet, which is where your cryptocurrencies like Bitcoin and Ethereum are stored. To use a crypto debit card, you need to connect to a crypto wallet. You can open one through an exchange or crypto trading platform if you don’t already have one.

Some crypto debit cards are backed by Mastercard and Visa, making it easy to use your card anywhere debit payments are accepted. Each time you use a crypto debit card to make purchases, funds are deducted from your crypto wallet balance automatically, just like fiat would be.

Crypto debit cards vs. traditional debit cards

Unlike traditional debit cards, crypto debit cards go through the extra process of converting your crypto assets into fiat currency. You may be required to convert crypto from your wallet or exchange account into CAD before loading it onto your crypto debit card.

On the other hand, some crypto cards convert your crypto as soon as you fund—or, as some cards call it, “top off”—your crypto wallet, while others convert it when you make a purchase.

It’s important to note when your crypto card converts cryptocurrency into fiat currency, as you may be locked into a potentially weaker or stronger exchange rate.

3 ways crypto converts when you use a crypto debit card

1. Converts as soon as you fund your crypto wallet

Cards like the Crypto.com Visa card convert your cryptocurrency into fiat currency like Canadian dollars when you fund it. Purchases are deducted from your balance, requiring no further conversion for transactions.

Automatic conversions are easier to manage, but cryptocurrencies are volatile. If the conversion takes place during a dip in value, you’re stuck with that low rate until you spend down your account.

2. Converts at the point of transaction

Certain cards convert your cryptocurrencies to fiat at the time of purchase.

This model can lead to the freshest rates, allowing your crypto assets to grow with the market until you’re ready to spend them. But it can also lead to more complicated taxes, with each transaction potentially triggering a taxable event reportable on your tax returns.

3. Manually converts at the time of your choosing

Cards like the Shakepay Card require you to manually convert your cryptocurrency into fiat before you can load your card and make a purchase. If you haven’t yet converted your crypto and you attempt to make a purchase from your wallet, your transaction is declined.

This method gives you the control and flexibility of converting when exchange rates are strong, although you must stay on top of your wallet to avoid your card being declined when least expected.

What to know about tax and crypto in Canada

In Canada, the Canada Revenue Agency (CRA) treats crypto like an investment for tax purposes. Anyone who buys, sells or invests in cryptocurrency needs to be aware of their tax responsibilities. For example, you need to keep records for all your transactions, as disposing of cryptocurrency might incur capital gains tax.

While you can estimate taxes on your crypto profits, it’s best to talk with a tax professional about your specific crypto card to learn how your spending habits can affect what you might owe the government.

5 features to look out for

When searching and comparing different crypto debit cards in Canada, look out for these features:

• Account type. Some crypto debit cards are attached to crypto wallets offered by a specific exchange, while others may let you choose a crypto wallet or bank account to top-up your card.
• Currency conversion. If you want your crypto to instantly convert into CAD or USD upon funding your account, you may want to go with a card like the Crypto.com Visa card. Otherwise, look for alternatives that convert your crypto at the time of purchase or manually at your preferred rate.
• Supporting cryptocurrencies. Not all crypto debit cards support converting from every cryptocurrency. Some may only allow deposits from popular cryptocurrencies like Bitcoin, while others only let you deposit stablecoins like USDC or USDT.
• Withdrawal fees. Often, there are no fees associated with depositing cryptocurrency, but withdrawing funds may be a different case. If you don’t plan on keeping your cryptocurrency in a crypto wallet all the time, find out if there are any withdrawal fees.
• Rewards. Crypto rewards (similar to cash back rewards) are the most common incentive offered by crypto debit cards. This incentive varies between service providers, with some even offering the opportunity to send rewards straight into a crypto account. Some platforms also offer loyalty tiers that reward you in the platform’s native coin.

How safe are crypto debit cards?

Crypto debit cards are as safe to use as traditional debit cards. You’re required to submit “Know Your Customer” (KYC) documentation to meet governing regulations when you apply for a crypto debit card.

The majority also implement strict security measures to prevent unauthorized access. For example, you’ll be asked to establish strong passwords and set up two-factor authentication.

Benefits and drawbacks of crypto debit cards

Some of the key benefits for using a crypto debit card include the following:

Before you sign up for a crypto debit card

Similar to traditional banking, KYC documentation and verification are required when you get a crypto debit card in Canada. This process is designed to deter money laundering and terrorist-related activities.

Most crypto cards require you to first download the card issuer’s app before completing the KYC verification process, which typically requires your full name, address, a photo of your government-issued ID or driver’s licence and a photo of yourself.

Once you’re verified, you can fund your crypto wallet, and you may be required to stake your crypto for a specific time. For example, the Crypto.com Visa debit card requires you to stake CRO—its native coin—in the app for 180 days.

Can I buy crypto with a debit card?

Yes, some trading platforms like Bitget, Kraken and Paybis let you buy crypto with a debit card in Canada. Depending on the platform you choose, a variety of other payments methods may also be available, including Interac e-Transfer, bank transfer, wire transfer and/or credit card. Compare these trading apps that let you buy crypto with a debit card in Canada.

Bottom line

As cryptocurrency becomes more mainstream, crypto platforms are offering prepaid cards that allow investors to manage and spend their cryptocurrencies on everyday goods and services—sometimes with cashback and rewards.