CRA indicates that the lack of income on bitcoins suggested that they might be acquired on income account

In 2014, a Canadian resident acquired from an unrelated insolvent foreign corporation the right to receive 740 bitcoins in consideration for a payment of 75 bitcoins. Ten years later, after the winding-up process for the non-resident corporation was completed, the taxpayer received 115.2602 bitcoins in settlement of the entitlement to receive 740 bitcoins.

Regarding whether this transaction was an adventure in the nature of trade, CRA indicated that Meronek and Dally (finding that debts, owing by corporations in financial difficulty, that were acquired for nominal amounts gave rise to profits from adventures in the nature of trade on their repayment as they did not have the characteristics of an investment) “were worth mentioning.”

Here, CRA noted as relevant that the right to receive the bitcoins was not likely to generate income during the period of ownership. Additionally, the 10-year holding period might have corresponded to the time required to complete the winding-up process rather than reflecting an intention to retain the right in the long term.

However, CRA did not conclude as to whether the gains were business income or capital gains.

Neal Armstrong. Summaries of 10 September 2025 External T.I. 2025-1070171E5 F under s. 9 – capital gain v. profit – crypto, and s. 54 – ACB.