A staggering 40% of Canadians using crypto platforms may be evading taxes or are at high risk of doing so, according to a new report from the Canada Revenue Agency (CRA). The revelation comes as part of the CRA’s latest efforts to clamp down on tax non-compliance in the fast-moving world of digital assets. With millions flowing through crypto exchanges each year, the agency is now taking a firmer stance on tracking and auditing crypto transactions.
Exposure
The CRA confirmed in an email to the Canadian Press that 40% of cryptoasset platform users it investigated were either evading taxes or posed a high risk of non-compliance. That means nearly half of Canadian crypto investors could be flying under the radar of the country’s tax system.
To address this growing concern, the CRA has launched a dedicated cryptoasset audit program with 35 auditors currently working on over 230 active files. Their investigations have already uncovered $100 million in unpaid taxes over the last three years — a clear sign that this isn’t just a small-scale issue.
Enforcement
While the CRA has made notable progress, it also admits that there are serious legal limitations that hinder its ability to track crypto transactions accurately. The agency stated that there’s “no way to reliably identify taxpayers operating in the crypto space” or ensure full compliance under current laws.
This limitation was highlighted during the agency’s battle to obtain user data from Dapper Labs, a Vancouver-based blockchain firm. The CRA originally requested information on 18,000 of Dapper’s users, but after legal negotiations, it only gained access to 2,500 users’ records — a small slice of the platform’s customer base.
Regulation
To tackle these challenges, the Canadian government has pledged to introduce new legislation by Spring 2026 to improve its ability to detect and prosecute tax evasion and financial crime, especially in crypto markets.
Finance Minister François-Philippe Champagne emphasized the need to adapt Canada’s laws to match the pace of financial innovation. Speaking in October, he said:
“Fraud and financial crime are evolving rapidly, and so must our response.”
The proposed measures include:
- Launching a Federal Anti-Fraud Strategy
- Creating a Financial Crimes Agency
- Introducing stronger oversight for crypto transactions
- Addressing economic abuse and digital financial manipulation
Compliance
The CRA’s struggle with Dapper Labs underscores the broader issue: many crypto companies operate in regulatory grey zones. And while users are required to report crypto income or capital gains, lack of clear enforcement makes it easier to underreport or ignore altogether.
In fact, many Canadian taxpayers remain unaware that any profits from crypto sales, trades, or even mining must be declared on their annual returns. This lack of clarity, paired with rapid crypto growth, has created a perfect storm for tax non-compliance.
Fines
While legislation slowly develops, other Canadian agencies have already begun cracking down. The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) recently fined Peken Global Ltd., the Seychelles-based company behind crypto exchange KuCoin, a whopping $19.5 million.
The fine was issued for operating without registration as a foreign money services business in Canada, a violation of national anti-money laundering regulations. It’s one of the largest penalties ever issued in the Canadian crypto space and a sign that regulators are ready to get tough.
Outlook
With nearly half of crypto users being flagged for potential tax evasion, the message is clear: the days of crypto flying under the radar in Canada are numbered. Whether you’re casually trading tokens or holding long-term digital assets, it’s now more important than ever to stay on the right side of the CRA.
Expect tighter rules, increased audits, and harsher penalties over the next two years. And if you’re unsure about your crypto tax obligations, it might be time to speak to a tax advisor — before the CRA comes knocking.
FAQs
What percent of crypto users risk tax evasion?
CRA says 40% are evading or at high risk of non-compliance.
How much tax has CRA collected from crypto?
Over $100 million in the past three years from crypto audits.
What new crypto laws are coming in Canada?
New legislation is expected by Spring 2026 to fight fraud.
Did Dapper Labs share user data?
Partially. CRA got info on 2,500 out of 18,000 requested users.
Who got fined by FINTRAC?
KuCoin’s parent firm was fined $19.5M for registration failures.
