Is Bybit Legal in Canada? Is Bybit Safe?
Choosing a trustworthy cryptocurrency exchange is crucial as it directly impacts the safety and security of your digital assets. The high risk of scams in this area necessitates extreme caution from users.
Our analysts have noticed a growing interest in Bybit services among users in the Canada. However, questions remain regarding its safety and legal status within the Canada. Traders Union experts have addressed this concern by crafting a detailed review that explores both the pros and cons of using Bybit.
So, let us tell you if Bybit is allowed in the Canada and if it's safe to use for trading.
Short summary about the Bybit exchange
The Bybit cryptocurrency exchange first appeared in 2018. It is a standalone derivatives trading platform with inverse and perpetual futures contracts with up to 1:200 leverage. Quarterly USD futures are available at Bybit in combination with BTC, ETH, XRP, EOS, LTC, and multiple tokens. There is a linear futures contract on BTC/USDT. The exchange has several technological advantages: it provides for mutual insurance of market participants against possible sharp price movements. There are offsets for long and short positions, and there is market depth.
| 💰 Account currency: | Cryptocurrencies |
| 🚀 Minimum deposit: | From USD 1 |
| ⚖️ Leverage: | Up to 1:100 |
| 💱 Spread: | From USD 1 |
| 🔧 Instruments: | BTC/USD, ETH/USD, XRP/USD, EOS/USD and BTC/USDT, USDT pairs — ETH/USDT, LINK/USDT, LTC/USDT, XTZ/USDT |
| 💹 Margin Call / Stop Out: | No |
Bybit Pros and Cons
👍 Bybit Pros:
•It has a convenient, intuitive proprietary trading platform that is presented in the browser version, which eliminates conflicts with the operating system and braking when sending orders;
•Integration with TradingView allows users to simplify crypto market analysis and trading via a single platform;
•Combination of futures and perpetual contracts trading;
•There is an order book that allows you to assess the depth of the market and current trading volumes;
•It has a minimum entry threshold. The cost of a BTC/USD futures contract is USD 1;
•It is possible to open long and short positions with subsequent mutual recalculation.
👎 Bybit Cons:
•It has conditions for trading futures that are difficult for beginners, such as the formula for calculating the leverage, the terminology of the funding size and the premium index, funding rates, etc.;
•Lacks a mechanism to protect the interests of traders in the event of controversial issues;
•The mechanism of classic cryptocurrency trading is almost undeveloped. Only USDT, ВТС, and ЕТН are available for purchase.
Rules and Regulation
Cryptocurrency Regulation in Canada
Cryptocurrency regulation in Canada is controlled by various regulatory bodies to ensure compliance and protect investors. The primary regulatory authority is the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), which monitors cryptocurrency exchanges for compliance with anti-money laundering (AML) and know your client (KYC) regulations.
Licensing Demands
Cryptocurrency exchanges that operate in Canada are required to register with FINTRAC and comply with AML/KYC regulations. Additionally, some provinces may require exchanges to obtain additional licenses or registrations, depending on their specific activities.
Investor Protection
Investor protection in the cryptocurrency market is a priority in Canada. The Canadian Securities Administrators (CSA) issues warnings and guidelines to educate investors about the risks associated with cryptocurrency investments. Moreover, the Ombudsman for Banking Services and Investments (OBSI) offers recourse for investors in case of disputes with cryptocurrency service providers.
Taxation
Profits from trading cryptocurrencies are subject to taxation in Canada. The Canada Revenue Agency (CRA) treats cryptocurrencies as commodities for tax purposes. Therefore, capital gains tax applies to cryptocurrency transactions, and traders are required to report their gains as income. Tax rates depend on various factors, including the individual's income bracket and the frequency of trading.
Is Bybit legal in Canada? Does it have a license?
Before you start working with an exchange, it is important that you check whether it has a financial license. Exchanges may be regulated by various financial regulatory authorities, including central banks, securities and exchange commissions or even regional bodies. A cryptocurrency exchange may not be regulated in Canada, but it can hold a license issued by another reliable regulator. Below, you can find out about the regulation of the Bybit cryptocurrency exchange.
| Bybit | |
|---|---|
| SEC | No |
| FINRA | No |
| SIPC Protection | No |
| Other regulators | No |
Cryptocurrency exchanges often hide information about the company, and it could be very difficult to find it to check whether the crypto exchange is legit or not. However, you still need to try.
Take notice of the following information:
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Name of the broker.
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Country of registration.
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Registration license number.
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Legal address.
As a rule, this kind of information can be found in the About Us section, in the disclaimer or in the regulatory documents of a cryptocurrency exchange: Terms and Conditions. As for the license, a crypto exchange might not have this document. This is due to the peculiarities of cryptocurrency regulation, as many countries still have not adopted the licensing law in this area.
Do I recommend using Bybit in the Canada?
The Bybit cryptocurrency exchange can certainly be recommended for traders from Canada. The platform is well suited for trading cryptocurrencies. Despite that the company does not have a financial license, as this kind of activity is not subject to licensing in Canada in general, the exchange has a good reputation. The company’s team has developed reliable account protection and closely monitors the security of the platform.
FAQ
Can I work with crypto exchanges considering that they don’t have a license in Canada?
The fact that a crypto exchange does not have a license doesn’t mean that traders from Canada will have problems while working with it. Cryptocurrency exchanges are not subject to licensing in many countries, while there are many exchanges with good reputation. Assess the available information about the exchange and check its reputation.
What security methods for account protection do crypto exchanges employ?
Cryptocurrency exchanges may offer various security methods. These include the two-factor authentication, first and foremost, and also such methods as a security question, additional passwords, etc.
Can an exchange that has had a security-related incident in the past be trusted?
You need to check whether such incidents were regular. If it was one episode several years ago, while the reputation of the exchange is good, you can work with such an exchange.
Should I work with an exchange if I have doubts about its reputation?
No. Always choose the cryptocurrency exchanges that have a good reputation.
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Team that worked on the article
Mikhail Vnuchkov joined Traders Union as an author in 2020. He began his professional career as a journalist-observer at a small online financial publication, where he covered global economic events and discussed their impact on the segment of financial investment, including investor income. With five years of experience in finance, Mikhail joined Traders Union team, where he is in charge of forming the pool of latest news for traders, who trade stocks, cryptocurrencies, Forex instruments and fixed income.
Dr. BJ Johnson is a PhD in English Language and an editor with over 15 years of experience. He earned his degree in English Language in the U.S and the UK. In 2020, Dr. Johnson joined the Traders Union team. Since then, he has created over 100 exclusive articles and edited over 300 articles of other authors.