- The CRA has recovered over C$100 million (AU$109 million) in crypto tax audits but has not filed any criminal charges since 2020.
- Court orders, such as the recent Dapper Labs disclosure for 2,500 users, are being used to tackle widespread non-compliance.
- Canada is preparing stablecoin legislation and a dedicated financial crimes agency, while FINTRAC fines illustrate rising scrutiny on crypto firms.
Canada’s tax authority, the Canada Revenue Agency (CRA), has clawed back more than C$100 million (AU$109 million) through audits targeting cryptocurrency users, yet it has not filed any criminal charges since 2020. The CRA’s 35-person crypto audit team has reviewed over 230 cases and estimates that roughly 40 per cent of taxpayers using digital asset platforms either have not filed returns or face a high risk of non-compliance.
In a recent Federal Court filing, CRA officials highlighted the challenge of monitoring crypto activity, stating that the agency “believes there is no way to reliably identify taxpayers operating in the crypto space and assess compliance” with income tax obligations. This limitation underscores the complexity of enforcing tax laws in a sector defined by anonymity, cross-border activity, and rapid growth.
The CRA has increasingly turned to court orders to compel data disclosures from crypto companies. Most recently, it obtained information on 2,500 users from Vancouver-based Dapper Labs, the firm behind NBA Top Shot and CryptoKitties.
The agency initially sought records on 18,000 users but negotiated the scope down with company officials and lawyers. This was only the second time a Canadian court has mandated such disclosure from a crypto firm, following a 2020 order involving Toronto-based Coinsquare.
Related: Canadian Police Shut Down TradeOgre Exchange, Seize Millions in BTC, XRP and Others
Criminal Probes Lag Behind Audits
Despite significant recoveries from audits, criminal investigations have progressed slowly. Since 2020, five probes involving digital assets have been opened, but four remain ongoing with no charges. The CRA attributes delays to the complexity of cases, limited evidence, and the need for international cooperation.
Canada is also preparing new regulatory measures, including stablecoin legislation and a dedicated financial crimes agency set to launch by spring 2026. Finance Minister François-Philippe Champagne said the agency will focus on investigating complex financial crimes and recovering illicit proceeds.
Meanwhile, the anti-money laundering agency FINTRAC has issued substantial fines against crypto firms such as KuCoin and Cryptomus for regulatory breaches, illustrating the growing scrutiny on the sector.
Related: IMF Warns Fragmented Global Rules Could Undermine Stablecoin Market Stability
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