I am relatively new to investing in cryptocurrencies, but as a resident of Canada, starting with Canadian dollars, I have noticed that this comes with a few extra complications. My sense is that many options are available to fund a trading account with US $ or EUR, but the same is not true for CDN $. The purpose of this post is to (hopefully) give a couple of valuable tips to Canadians who want to get into cryptos but aren't sure where to start.
My first foray consisted of wiring CDN $ from my bank to the Kraken exchange, who indicated that this method came with no fees. However, the wire went through a Japanese bank where my CDN $ were exchanged for Japanese Yen and back again before making it to Kraken. The result was that in addition to the fees I paid at my bank, I also lost roughly 6.5% through the exchange process.
Since then, I have followed the following process, and it has worked out much better for me:
Step 1: create account on QuadrigaCX. This takes maybe ten minutes. Be sure to create a strong password and use two factor authentication.
Step 2: to fund with CDN$, you have to verify your identity. You will need to upload a scan of your driver's license, something like a utility bill with your name and address, and a picture if you holding your license. Verification process may take 2-3 days. (May be slightly longer than this because their volume is increasing). It is also possible to be instantly verified; this process involves information from Equifax, but I have not tried this.
Step 3: send your money. If you bank with a participating bank, you can use interac online. I had never done this before, but had no problem, it interfaces with your online banking page. Charge to do this is 1.5%, minimum $5 charge. Other options for funding and withdrawal, and associated fees, can be found here.
Step 4: use dollars to buy Bitcoin or Ether on QuadrigaCX. Transaction fee is 0.5% here. These are currently the only cryptos available on QuadrigaCX. You do pay a premium on this exchange relative to the market elsewhere. I haven’t really monitored the size of this over time, but I would estimate it to be 2-3%. However, when you eventually exchange back to Canadian, you will likely receive this premium in return. Also, there is enough fluctuation in a day, that you can eliminate the premium by setting a limit order. It is likely to get filled if you are within 2% of the current market price. If all you want is Bitcoin or Ether, you can decide what type of wallet you want to use. I won't get into that because many others know much more about this than I do.
Step 5: decide what other coins you want (if any), and which other exchange(s) to use. You can see where coins trade on websites like coingecko, and going to the Markets tab. I currently use Kraken, Bittrex and Poloniex.
Step 6: create an account on the other exchange(s) of interest. Because you won't be sending cash, minimal verification will be required, but details vary by the exchange.
Step 7: with both accounts open, hit withdraw on QuadrigaCX, and fund on the other exchange. Generate a deposit address on the other exchange (make sure you are generating an address for the correct coin). Copy and paste it to the withdraw address on QuadrigaCX, and there you go.
Step 8: trade Bitcoin or Ether for whatever coin you choose. Trades charge 0.26% or 0.16% generally.