Key Takeaways
- Bill C-88, the Digital Asset Reporting Act, received Royal Assent in May 2026 and takes effect January 1, 2027, requiring crypto exchanges to file annual reports with CRA for accounts with holdings above C$10,000.
- Reporting covers total holdings value, transaction volume, and asset types not individual transaction details, though CRA can request those separately under existing audit powers.
- Self-custody wallets are exempt from direct reporting obligations under the bill, but exchanges are required to report transfers to unhosted wallets above C$10,000.
- The C$10,000 threshold applies to the total account value at year-end, not individual transactions a distinction that captures many ordinary crypto investors.
- Bill C-88 mirrors the US OECD Crypto-Asset Reporting Framework (CARF) requirements Canada committed to implementing, aligning Canadian rules with G20 reporting standards by 2027.
Bill C-88, officially the Digital Asset Reporting Act, received Royal Assent from the Governor General on May 14, 2026, after passing the Senate with modest amendments. The legislation requires Canadian crypto exchanges and other digital asset service providers to file annual information returns with the Canada Revenue Agency for all accounts where the total crypto holdings at year-end exceed C$10,000. Implementation begins for the 2027 tax year, with first filings due in March 2028.
The bill has been in development since 2024, when Canada committed as part of its G20 obligations to implement the OECD’s Crypto-Asset Reporting Framework (CARF) a global standard for automatic information exchange of crypto asset data between tax authorities. Bill C-88 is Canada’s domestic implementation of that international commitment, meaning Canadian-held crypto data will eventually flow to tax authorities in other OECD member countries through treaty-based information exchange.
What Exchanges Must Report
Under Bill C-88, designated crypto exchanges defined to include any platform that provides crypto trading, custody, or exchange services to Canadian residents must file an annual “Digital Asset Information Return” with the CRA. The return covers the following for each qualifying account:
The account holder’s legal name, social insurance number, date of birth, and address. The total fair market value of crypto assets held at December 31 of the reporting year, in Canadian dollars. The total amount received and total amount disposed of during the year. The types of crypto assets held (by category: Bitcoin, Ethereum, stablecoins, other). The total value of transfers to unhosted (self-custody) wallets during the year.
Notably, the bill does not require exchanges to report individual transaction details. The CRA receives a summary picture, not a transaction log. However, CRA’s existing audit powers allow it to request detailed transaction records from exchanges for specific accounts under review meaning the annual return creates awareness that triggers deeper investigation where the summary numbers warrant it.
The C$10,000 Threshold: Who It Captures
The C$10,000 threshold applies to the total value of crypto assets held in an account at December 31, not to individual transactions or transfers. Given Bitcoin’s price above C$140,000 in mid-2026, a single Bitcoin or roughly 0.07 BTC in an exchange account at year-end triggers a reporting obligation for that account. By that measure, the threshold will capture a very large proportion of active Canadian crypto investors, not merely wealthy ones.
The threshold was deliberately set at a level that captures meaningful activity without creating administrative burden for the smallest casual investors. In its consultation response, the Department of Finance estimated that approximately 68% of Canadian exchange account holders would fall below the C$10,000 threshold meaning approximately 32% (estimated at 800,000–1 million Canadians) will have their crypto accounts reported to CRA annually beginning in 2028.
Self-Custody: The Unhosted Wallet Provision
The most debated provision of Bill C-88 during parliamentary review was the treatment of self-custody wallets. The bill stops short of requiring direct reporting on unhosted wallets hardware wallets, software wallets, and other self-custody arrangements where the user holds their own private keys. Technically and practically, such reporting would be impossible to enforce, as no third party controls the wallet.
Instead, the bill requires exchanges to report transfers to unhosted wallets above C$10,000. When a Canadian crypto exchange user sends more than C$10,000 in crypto to an external address (not an exchange-managed wallet), the exchange must include that transfer in its annual report, tagged as an “unhosted wallet transfer.” The CRA can then use this data to identify cases where investors moved assets to self-custody potentially to avoid reporting and investigate whether those assets have been appropriately included in tax filings.
For the majority of Canadian investors who use self-custody wallets for security rather than tax avoidance purposes, this provision is primarily a record-keeping reminder: assets in self-custody are still taxable when disposed of, and the CRA’s ability to identify on-chain activity through its Chainalysis contract means self-custody does not constitute effective tax evasion.
| Account Type | Reporting Threshold | What Is Reported | Effective Date |
|---|---|---|---|
| Exchange accounts (registered CA exchanges) | C$10,000 year-end value | Holdings, volume, transfers | Jan 1, 2027 |
| Exchange accounts (foreign exchanges serving Canadians) | C$10,000 year-end value | Same as above (via CARF) | Jan 1, 2027 |
| Unhosted wallet transfers from exchanges | C$10,000 per transfer | Amount, receiving address type | Jan 1, 2027 |
| Self-custody wallets (standalone) | No direct reporting | N/A self-reported on T1 | Ongoing (T1 obligation) |
| Crypto ETF accounts (BTCC, ETHH, etc.) | Existing T3/T5 rules apply | Trust income, capital gains | Existing |
Comparison to US 1099-DA Rules
Bill C-88 was developed with awareness of the US IRS’s Form 1099-DA (Digital Asset) reporting rules, which took effect for the 2026 tax year. The Canadian and US frameworks share the same OECD CARF foundation but differ in some implementation details. The US 1099-DA requires transaction-by-transaction reporting of gross proceeds more granular than Canada’s summary approach. However, the US rules face ongoing legal challenges and have been partially delayed for certain broker types.
Canada’s summary approach is administratively lighter for both exchanges and the CRA, but gives the agency slightly less granular data. The CRA has indicated this is an intentional design choice the goal is population-level awareness and audit targeting, not replacing the existing T1 reporting obligation that already covers individual transactions.
The Bottom Line
Bill C-88 is a predictable and proportionate step in the maturation of Canadian crypto regulation. The reporting requirements align with international G20 commitments and create a formal information bridge between crypto exchange activity and CRA audit functions. For the estimated 800,000–1 million Canadians who will be captured by the C$10,000 threshold, the practical obligation is unchanged crypto gains were always taxable but the likelihood of the CRA being aware of those gains is now materially higher. Investors who have been non-compliant should consider the CRA’s voluntary disclosure program before 2027 reporting begins.