Want to Buy Bitcoin? Here’s What To Look For In A Cryptocurrency Exchange In Canada

While traditional investment assets still hold sway in most portfolios today, investors are starting to warm up to the idea that alternative assets like Bitcoin can be worthwhile if you are looking to boost returns.

In 2021, Bitcoin and other cryptocurrencies made the airwaves and ranked as some of the most popular investments for retail investors. Even institutional investors were not left out, with these digital assets gaining endorsements from celebrities and technology smarts like Elon Musk.

Bitcoin initially started out as a niche technology used by individuals to carry out small transactions. Of course, it was started with the intention of replacing the current financial system and giving individuals complete control over their funds and assets.

While it hasn’t yet replaced the current economic system to any significant degree, cryptocurrencies have definitely given back some control to individuals over their funds and finances. 

Investing in cryptocurrencies such as Bitcoin is relatively simple. All you have to do is find a decent exchange, register, and you are all set. However, it is essential that the cryptocurrency exchange you choose ticks a few boxes.

What should you look for in a good cryptocurrency exchange?

Status Of Cryptocurrencies In Canada 

Before we move on, it is crucial to understand the views of the government of Canada on cryptocurrencies.

The Canadian government has held a reasonably favorable view on crypto and blockchain technology in general, with the Bank of Canada and Payments Canada jointly researching cryptocurrencies under their joint initiative, Project Jasper.

As it stands, Canadian citizens can legally buy, sell and trade cryptocurrencies. There are several cryptocurrency exchanges in Canada that citizens can approach to start their investment journey. 

What To Look For In A Cryptocurrency Exchange In Canada 

There are several cryptocurrency exchanges in Canada that you can choose from to start your crypto investment journey. Here are some things you should look for in a cryptocurrency exchange in Canada. 

1. Exchange Security 

Exchange security is one of the most significant factors that should influence your decision when it comes to choosing an exchange.

At the bare minimum, the cryptocurrency exchange should offer two-factor authentication (2FA) when it comes to securing your account and assets.

There are several authentication applications, such as Google Authenticator, that provide better security than text-based authentication. An exchange that does not offer 2FA probably isn’t too serious about security. 

Centralized exchanges offer increased liquidity and high trade volumes. However, they are also targeted by attackers frequently. Decentralized exchanges give anonymity and user privacy more importance, allowing users to sign up without parting with any personal information.

It is also considered prudent to store your cryptocurrencies in an offline wallet rather than an online or exchange wallet. Exchange wallets may be convenient, but they are susceptible to getting hacked. 

2. KYC Protocols 

It is imperative to select an exchange that follows proper KYC (Know Your Customer) and AML (Anti-money laundering) protocols.

Major cryptocurrency exchanges require users to submit certain documents like identity proof to verify their users and fulfill KYC regulations. The KYC regulations differ depending on the location of the cryptocurrency exchange.

While most cryptocurrency exchanges are extremely strict about KYC, some cryptocurrency exchanges are relatively relaxed when it comes to KYC regulations. 

3. Reputation Of The Exchange 

The cryptocurrency space is relatively new, and there are several exchanges out there. Of course, most cryptocurrency exchanges are reliable exchanges, but that does not mean every exchange is safe or reputable.

Some cryptocurrency exchanges have weak security protocols in place, with hackers often targeting them and stealing user funds. There are also examples of exchanges that have been part of exit scams.

Mt. Gox, one of the earliest and most popular cryptocurrency exchanges, is an example of a cryptocurrency exchange misleading users, leaving them in the lurch when it collapses. 

However, simple steps can ensure that you can avoid shady exchanges. Be thorough in your research when selecting an exchange. The internet has plenty of information about exchanges and read-up reviews of users who have already used the exchange.

Verify that the cryptocurrency exchange has a good reputation among investors in the crypto space. Most crypto exchanges also have a listed physical address. Any exchange with no physical address is an exchange to be avoided. 

Related: How To Buy Cryptocurrency Using CAD

4. Availability Of An Exchange

The availability of the exchange also depends on geographical location.

Certain cryptocurrency exchanges are present in some countries while absent in others. This could be for several reasons, such as feasibility or the current government not having a favorable outlook on cryptocurrencies.

International exchanges are available in most countries. However, it is vital to keep a sharp eye on any regulatory changes that may need compliance from your end. 

5. Customer Service 

Customer service is another critical factor that you should look at when selecting an exchange.

A reputable exchange will always have good customer service because let’s admit it, everyone wants a quick resolution in case their funds have been compromised, or they have been locked out of their account.

While most crypto exchanges leave a lot to be desired when it comes to prompt customer service, things are slowly but surely getting better. This Canadian exchange is blazing the trail for true omnichannel customer support that is unheard of in the space.

6. Cryptocurrency Prices 

Cryptocurrency prices can vary across exchanges, with certain cryptocurrency exchanges having lower prices than others. Some cryptos may trade at a lower price at some exchanges, while others may trade at a higher price.

A high discrepancy in the price may indicate that the exchange may be suffering from liquidity issues. 

7. Cryptocurrencies Offered 

Cryptocurrencies offered also vary significantly from exchange to exchange. While almost all exchanges provide the more significant cryptocurrencies such as Bitcoin, Ethereum, Litecoin, and others, more minor currencies may or may not be available on certain crypto exchanges.

If you want to invest in smaller cryptocurrencies, it is prudent to select a cryptocurrency exchange that offers them. 

8. Trading Volume And Liquidity 

Trading volume and liquidity are also some of the most essential factors that you should look at as they directly influence your ability to purchase or sell cryptocurrencies.

A significant trading volume is a good indicator of the exchange’s liquidity.

Suppose you intend to trade with some of the more prominent cryptocurrencies, such as Bitcoin and Ethereum. In that case, a centralized exchange is your best bet, as it has high liquidity and can handle high trading volumes. 

However, if you plan to trade with some of the smaller and less popular cryptocurrencies, then a smaller exchange is the way to go. Checking an exchange’s trading volume and liquidity is not a complicated task, with websites such as CoinMarketCap and Coin360 allowing users to check for them.

Related: Best Bitcoin Trading Apps in Canada 

9. Exchange Fees 

Exchanges charge fees for all transactions on their platform, with the fees varying between different exchanges.

Some exchanges charge lower fees than others, although the main factor that influences exchange fees is the size of the transaction. A more significant transaction may attract a higher fee from the exchange.

It is essential to verify exchange fees before selecting an exchange as they could significantly impact your trading habits. The crypto curious, first-time crypto investors, and lite traders may give priority to ease-of-use over fees.

For this segment, it may be prudent to choose a crypto exchange with competitive fees and an easy-to-use platform vs. one that may be complex to trade but boasts about having the absolute lowest fees.

10. Always Go With Better Security 

It is often said that the harder it is to create an account, the better the exchange. A good exchange will always be thorough with all KYC and AML regulations when opening an account.

If an exchange makes it too easy, it probably means that the exchange is a bit lax when it comes to security, so don’t go for the low-hanging fruit, and always choose an exchange that makes it a little difficult to open an account. 

How To Buy Cryptocurrency In Canada 

You are now getting to the buying part. You’ve considered all the points listed above and want to zero in on an exchange.

You have to choose an exchange that fits all your trading needs, considering factors such as how many cryptocurrencies do you plan on investing in? The payment methods offered by the exchange etc.

Several exchanges based in Canada meet all of the criteria listed above, with one of the best rated being CoinSmart. CoinSmart is one of the top exchanges in Canada and meets all the requirements that you would look for in an exchange, ideal for active as well as long-term traders. 

CoinSmart was founded in 2018 by Justin Hatrzman and Jeremy Koven, and it has proven itself to be a reliable and beginner-friendly exchange.

It offers its users quick verification, a simple user interface, incredible security, and options for different fiat currencies. It is also an excellent exchange for more experienced and high-volume traders with several advanced options available. 

Learn more about the platform in this CoinSmart review.

How To Sign Up For CoinSmart 

Signing up for CoinSmart is easy following the steps below:

  • Create your CoinSmart account using your email id, ensure that you set a strong password. 
  • CoinSmart will then require you to complete your KYC. Once your KYC has been completed and verified, you will be able to deposit funds into your CoinSmart and begin trading. 
  • You have several options to buy cryptocurrencies, including credit cards.

Open a CoinSmart Account and get a $50 bonus when you fund your account with at least $200.


Although investing in cryptocurrencies may seem like a daunting task, it is pretty simple if you do your research thoroughly and only invest based on your risk tolerance.

While there are several exchanges to choose from in Canada, CoinSmart is one of our top choices to begin your crypto investment journey.

It is ideal for beginners and offers several advanced options for more active traders. Ready to buy Bitcoin with CAD?

Best Crypto Offer This Month

Overall best crypto exchange in Canada + $50 bonus

Crypto trading platform for beginners and advanced traders.

Access to several popular coins.

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$50 instant bonus when you deposit $200.

Easily deposit and withdraw both fiat and crypto.

A publicly traded company on the Canadian NEO exchange.

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Enoch Omololu

Enoch Omololu is a personal finance expert and a veterinarian. He has a master’s degree in Finance and Investment Management from the University of Aberdeen Business School (Scotland) and has completed several courses and certificates in finance, including the Canadian Securities Course. He also has an MSc. in Agricultural Economics from the University of Manitoba and a Doctor of Veterinary Medicine degree from the University of Ibadan. Enoch has a passion for helping others win with their personal finances and has been writing about money matters for over a decade. He has been featured or quoted in The Globe and Mail, Winnipeg Free Press, Wealthsimple, Financial Post, Toronto Star, CTV News, Canadian Securities Exchange, Credit Canada, National Post, CIBC, and many other personal finance publications.

His top investment tools include Wealthsimple and Questrade. He earns cash back on purchases using KOHO, monitors his credit score for free using Borrowell, and earns interest on savings through EQ Bank.

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