It’s no secret: Canadians all over the country are almost as fond of placing bets as they are about cheering for their favorite hockey teams. Now that crypto has entered the betting game, the rules are changing and navigating the scene with confidence requires a little more homework.
Before taking a stab at crypto betting, it’s a good idea to figure out what’s going on in the wider legal landscape. Is crypto betting even legal? What exactly does a novice crypto bettor need to know? Here’s what novices with an appetite for crypto sports betting need to understand:
Sports Betting is Legal
First things first. Single game sport betting has been legal across the country since 2021. In a nutshell, this means that a bettor can legally wager on the potential result of any particular game. This is good news for Canadians because legality means regulations have been put in place to protect gamblers from shady casino business practices.
But, there is a catch. The rules aren’t as clear-cut as they probably should be. The rules surrounding systems such as AML are complex and regulations tend to vary by province. Plus, the use of crypto isn’t really addressed in many legislations. Where a person lives might affect their ability to place wagers and dictate which platforms they’re allowed to engage with. Why? Because Canada has taken a case-by-case approach to gambling regulations.
This essentially means that leaders in each individual Canadian province are allowed to set their own rules for online sports betting. So, what’s legal in Ontario might not be allowed in New Brunswick, for example.
Regulations surrounding crypto wagers are absent
When Canada’s governing body laid out the groundwork regarding sports betting, wagering using crypto wasn’t addressed. There are currently no specific laws around their use either way.
Now, this oversight might seem like a good thing. Less rules means more freedom, right? Not so fast. The lack of clear regulations on crypto in sports betting has created something of a gray area. The fact that there are no explicit mentions of crypto use in most provincial gambling regulations has left operators and lawmakers scratching their heads in confusion.
Understanding the gray area
With no solid protections in place, betting with crypto is a little more risky than usual. It’s up to the player to figure out where to play and which platform to trust. Naturally, a bettor should stick with licensed sportsbooks, but what about the provinces that don’t have any?
In this case, players might be inclined to interact with offshore or international operators that cater to the Canadian public. This is perfectly legal for the most part, but bettors must pay attention and choose wisely. Make absolutely sure accounts are created only on reputable sites.
Sometimes, a reputable offshore site won’t cater to specific areas. This is the case for Ontario with Stake.com. In this case, Stake can offer its betting services to most residents but not for people living in Ontario because they are still in the process of getting their hands on the right license. For residents outside of Ontario, there’s a Stake.com bonus available for Canadian users that allows them to get more for bang for their buck.
If a player is savvy and wishes to bet with Stake.com in Ontario in spite of the current legal complications, there is a way to get around the current restrictions by making use of a VPN. This is not advisable however, as it can open bettors up to legal trouble down the line if a player isn’t careful.
Are crypto bet winnings taxable?
In short, yes. At the moment, the Canada Revenue Agency considers cryptocurrencies to be commodities which means a lucky bettor’s winnings are considered taxable. Bettors who use crypto to wager on sports will need to keep detailed records of their income and must report their winnings and losses on their income tax return.
How much tax a bettor pays will be subject to where they live. In Ontario it’s important to note that the province doesn’t have any additional taxes specific to crypto betting winnings. However, the general income tax rules outlined above still apply. If this is all a little too confusing, it’s recommended to have a chat with a tax professional to stay in-the-know.
Will the landscape get better?
With the growing popularity of both crypto and sports betting, clear-cut rules and regulations are probably just around the corner. These new rules could pave the way for a future that’s not just safe and transparent, but also beneficial to the people of Canada. Tax from winnings could fund worthwhile projects like the construction of new sports complexes and stadiums.
Oshawa has already set its economic sights on emerging sectors such as Artificial Intelligence and Augmented Reality. As this tech, along with crypto use, evolves and becomes more widespread, residents can expect new regulations to be set in stone by Canada’s government.
Clear regulations will no doubt lead to stricter security protocols for crypto transactions within online sports betting platforms. This would give bettors more confidence knowing both their funds and personal details are protected.
Navigating crypto bets in Canada
Whenever a new way of doing things, like betting with crypto, is introduced to the public, there will always be issues at the beginning. But this is not cause for despair. Sooner or later, laws will catch up and betting will become easier. For now, bettors should take the time to learn everything they can before placing a wager and always remember to gamble responsibly.