Does Bybit Report to the CRA?
If you're a Canadian resident and have traded on Bybit in the past, the CRA may already know. Learn how the CRA tracks crypto and what it means for your taxes.
Bybit halted new account registrations and withdrew services in Canada in 2023 following a settlement with the Ontario Securities Commission.
As such, it’s unlikely the exchange will share data with the CRA going forward.
The CRA regularly requests information from crypto exchanges, including past transaction records, so it’s important to ensure all previous activity is reported correctly.
Is Bybit legal in Canada?
No. Bybit is no longer legal for use in Canada.
Due to regulatory pressure from the Canadian Securities Administrators (CSA) and the Ontario Securities Commission (OSC), Bybit stopped onboarding new Canadian users in May 2023 and fully restricted existing users from trading or holding positions by September 30, 2023.
The platform is now listed as unavailable to Canadian residents. Using Bybit through workarounds like VPNs violates its terms of service, and funds may be frozen at Bybit’s discretion.
Why isn’t Bybit legal in Canada?
Bybit is not legal in Canada because it failed to comply with national securities regulations.
The platform allowed Canadians to trade crypto assets that are considered securities or derivatives without being registered with Canadian regulators. In 2022, the Ontario Securities Commission fined Bybit around $2.5 million and ordered it to stop serving Ontario users.
Rather than meet the stricter requirements introduced by the Canadian Securities Administrators, such as restrictions on leverage and stablecoins, Bybit chose to exit the Canadian market entirely. By late 2023, it had fully shut down services for Canadian users and now lists Canada as a restricted jurisdiction.
Read next: Best Crypto Exchanges Canada
Does Bybit report to the CRA?
Since Bybit no longer operates in Canada, it’s unlikely the platform is sharing user data with the CRA going forward.
In contrast, crypto exchanges that are legally registered in Canada must comply with FINTRAC regulations and enforce identity verification (KYC). These regulated platforms may share user information with government bodies such as the CRA when required.
What do crypto exchanges report to the CRA?
The CRA hasn’t been entirely transparent about the specific data it receives from crypto exchanges, but its overall approach is becoming increasingly aggressive and sophisticated.
What’s clear is that the CRA actively collaborates with cryptocurrency platforms to collect user data. This information helps the agency monitor Canadian crypto activity and verify whether individuals are properly reporting their holdings and paying any taxes owed.
While Bybit no longer operates in Canada and is unlikely to share data with the CRA, registered exchanges within Canada must comply with strict regulations. Since January 2022, all money services businesses have been required to report transactions over $10,000 to the CRA. On top of that, FINTRAC-registered exchanges must conduct full identity verification, including government-issued ID and proof of address, giving the CRA a clear link between users and their wallets.
The CRA also works internationally through the Joint Chiefs of Global Tax Enforcement (J5), sharing data and collaborating with tax authorities in other countries to investigate offshore crypto holdings and cross-border tax evasion. In addition, it uses blockchain analysis tools to trace transactions across public ledgers, allowing it to detect unusual patterns and potentially tie wallet activity back to individual taxpayers, even when users believe they’re anonymous.
How do I report my Bybit taxes to the CRA?
If you’ve previously earned income, realized gains, or incurred losses from trading on Bybit, you’re expected to report these to the CRA, either by amending a past return or through the Voluntary Disclosures Program if necessary.
Since Bybit doesn’t issue tax forms for Canadian users, many investors turn to a crypto tax calculator like Koinly to calculate their taxable amounts and generate the reports needed for filing.
Read next: Canada Crypto Tax Guide
Report your crypto taxes with Koinly
Koinly makes crypto tax reporting in Canada straightforward. You can import your transaction history using API connections or by uploading a CSV file from over 900 supported exchanges, wallets, and blockchains.
After importing your data, Koinly automatically calculates your capital gains, losses, income, and other taxable events, then creates the reports you need to file accurately with the CRA. Learn more about how to do your Bybit taxes.
FAQs
Do I have to pay tax on my Bybit transactions?
Yes. Any profits from your Bybit transactions are taxable. You can learn more in our Canada crypto tax guide.
Do I need to file a Form T1135 for Bybit?
Canadian residents who hold specified foreign property (SFP), including certain crypto assets, with a total cost of over $100,000 CAD at any time during the year may need to file Form T1135 with the CRA. Whether or not crypto holdings trigger this requirement depends on how and where the assets are stored or held.
Is Bybit registered with FINTRAC?
No. Bybit is not registered with FINTRAC and no longer operates in Canada.
How do I avoid Bybit taxes in Canada?
You can't legally avoid paying crypto tax in Canada, but there are legal ways to reduce your tax burden, such as tax loss harvesting. Crypto tax tools like Koinly include features like tax optimization to help identify potential savings. Learn more in our guide on how to avoid your crypto taxes legally in Canada.
