First off I want to establish the market need for a real financial product that captures the Canadian TSFA (Tax-Free-Savings-Account) as a vehicle to hold crypto assets. This is a relatively easy thing to set up for traditional securities through a bank or other Wealthsimple products. The TFSA works by a Canadian putting their taxed income into a savings account from which that person can purchase and hold securities. The huge financial upside is since the investment was taxed income dollars the upside is tax free (hence Tax-Free of the TSFA), meaning that purchasing securities that offer high yields does not fall into capital gains. This account has been a extremely good way for a new investor to be able to access the public markets with a lower risk higher reward.
So, what is the problem...?
The problem is that I cannot hold my crypto assets in any TSFA. When I graduated university came to some Bitcoin as one does, in 2018 I sold that Bitcoin (which only should be done for very drastic purposes like the bubble), and I learned a lot about the Canadian tax laws as they pertain to securities. So, when I heard about the Wealthsimple Crypto platform I was excited as I hold my TSFA with their mutual fund, I thought that finally I could hold my crypto in a TSFA and keep those sweet sweet gains for my hugely risky investing behaviour. However, to my dismay they do not have the TSFA functionality in the platform, and honestly the app is pretty crap for a crypto application. I am sorry developers not a personal thing, the UI is sweet and Trade is a good platform. I am complaining about the 5 day hold on my funds to purchase crypto, inability to withdraw or deposit crypto, only Ethereum & Bitcoin but it is not an "on ramp" to digital currency. The Crypto add on to the Trade app safe bank secured way to buy crypto but it is slow and being bank secured is paradoxical to crypto. Waiting for funds to transfer for more than a couple hours is a huge stopping factor to adoption. When you have competitors like Newton or Shakepay both have way better referral options $25 & $30 for signup and depositing $100 (it can be the same currency go from platform to platform hint hint :)*).
For now we will have to stick to buying stock in public companies that either own massive amounts of Bitcoin/Ethereum or mining operations for generating crypto. If you want to read on that here is a follow up article on Yahoo Finance.
Sending it into 2021!! HAPPY NEW YEAR Friends :)