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Crypto.com Prepaid Card and Crypto Exchange Thread

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LOL808 wrote: Since they are now officially operating in Canada, they are legally required to issue T5 for any of the interest or divvy income ...
They won't. They'll only do it for the US afaik, and take SSN for US signups.

Canadians have their own responsibility to report crypto capital gains to the CRA.
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I've been looking at these cards trying to assess risks - I think I am going to get the Ruby card as it makes the most sense to me - "invest" and keep "invested" only $200 (value of 2500 CRO coins when I post this message), after 1 year you break even.
With Jade/Green cards it's $2200 "investment" - about 5 years to break even, so there's a risk to loose money.
I am wondering if are you considering to stake 250k CRO coins (about CAD$ 22k now) to get Icy White/Rose Gold cards - how are you justifying the risks if, say, CRO coin will lose 90% of its value?
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rhw123 wrote: AFAIK, if you do everything by the book:
  • If your "staked" CRO earns interest or a dividend, that's taxable income (just like C$ interest or dividend) and for your adjusted cost base administration you acquire those coins at fair market value at that moment in time.
  • Cashback earned as CRO on card purchases is not taxable income but for your adjusted cost base administration you acquire those coins at fair market value at that moment in time.
  • Any time you dispose of (e.g. sell for fiat or exchange for a different cryptocurrency) some or all of your CRO, regardless or how you acquired them, that generates a capital gain or loss (difference between sell price after fees and your adjusted cost base).
Are you sure about "Staking" and "Earn" being counted as taxable income? The CRA tax guide is written in a very vague way. First paragraph describes Staking and the next describes how Mining is treated for Tax Purposes. It grouped Staking together with Mining, but does not specifically say how Staking should be treated. It's difficult to tell what would qualify as a hobby versus business activity because I don't see how anyone is just doing this for fun as opposed to trying to make money if they are using their Crypto in this way.

Staking (proof of stake) is a different process to earn cryptocurrency payments but may still result in earnings that have tax implications. Proof of stake is an alternative distributed consensus mechanism where a person is selected out of a group of participants (forgers) to validate a block of transactions. Much like mining, when the selected person successfully creates a valid block, they will receive two amounts in one payment. One amount will represent the creation of a new cryptocurrency on the network and the other amount will represent the fees from transactions included in the newly validated block.

Earning cryptocurrencies through mining
Cryptocurrencies are commonly acquired in two ways:

bought through a cryptocurrency exchange
earned through mining
Mining involves using specialized computers to solve complicated mathematical problems which confirm cryptocurrency transactions. Miners will include cryptocurrency transactions into blocks, and try to guess a number that will create a valid block. A valid block is accepted by the corresponding cryptocurrency’s network and becomes part of a public ledger, known as a blockchain. When a miner successfully creates a valid block, they will receive two payments in a single payment amount. One payment represents the creation of new cryptocurrency on the network and the other payment represents the fees from transactions included in the newly validated block. Those who perform the mining processes are paid in the cryptocurrency that they are validating.
The income tax treatment for cryptocurrency miners is different depending on whether their mining activities are a personal activity (a hobby) or a business activity. This is decided case by case. A hobby is generally undertaken for pleasure, entertainment or enjoyment, rather than for business reasons. But if a hobby is pursued in a sufficiently commercial and businesslike way, it can be considered a business activity and will be taxed as such.
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stillmatic11 wrote: Are you sure about "Staking" and "Earn" being counted as taxable income? The CRA tax guide is written in a very vague way. First paragraph describes Staking and the next describes how Mining is treated for Tax Purposes. It grouped Staking together with Mining, but does not specifically say how Staking should be treated. It's difficult to tell what would qualify as a hobby versus business activity because I don't see how anyone is just doing this for fun as opposed to trying to make money if they are using their Crypto in this way.

Staking (proof of stake) is a different process to earn cryptocurrency payments but may still result in earnings that have tax implications. Proof of stake is an alternative distributed consensus mechanism where a person is selected out of a group of participants (forgers) to validate a block of transactions. Much like mining, when the selected person successfully creates a valid block, they will receive two amounts in one payment. One amount will represent the creation of a new cryptocurrency on the network and the other amount will represent the fees from transactions included in the newly validated block.

Earning cryptocurrencies through mining
Cryptocurrencies are commonly acquired in two ways:

bought through a cryptocurrency exchange
earned through mining
Mining involves using specialized computers to solve complicated mathematical problems which confirm cryptocurrency transactions. Miners will include cryptocurrency transactions into blocks, and try to guess a number that will create a valid block. A valid block is accepted by the corresponding cryptocurrency’s network and becomes part of a public ledger, known as a blockchain. When a miner successfully creates a valid block, they will receive two payments in a single payment amount. One payment represents the creation of new cryptocurrency on the network and the other payment represents the fees from transactions included in the newly validated block. Those who perform the mining processes are paid in the cryptocurrency that they are validating.
The income tax treatment for cryptocurrency miners is different depending on whether their mining activities are a personal activity (a hobby) or a business activity. This is decided case by case. A hobby is generally undertaken for pleasure, entertainment or enjoyment, rather than for business reasons. But if a hobby is pursued in a sufficiently commercial and businesslike way, it can be considered a business activity and will be taxed as such.
No, I'm not sure. Probably the CRA isn't either Face With Tears Of Joy

But if the rules that apply to mining also apply to staking, going on common sense I'd also say that buying a stake in some scheme that promises interest/dividend is difficult to sell as a not-for-profit "hobby".

I'm glad I don't have to figure this out. Good luck! Smiling Face With Sunglasses
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I've been manually tracking every Crypto Transaction, but I will be buying Crypto Tax Software for tax season next year to hopefully be able to take care of most of this. Reading over it again, I think Staking/Interest earned would be taxable and the hobby part determines whether it is treated as a Capital Gain (Taxed 50% of whatever earned) versus Business Income where the entire amount counts and what you pay is determined by your tax bracket. Airdropped coins are considered cost basis $0 so the entire amount counts as what is earned for tax purposes, so I think it makes sense that Staking/Earn would be end up taxable as well.

The cashback part is what could become a real headache if I'm supposed to factor in the DCA each time I receive CRO for a purchase made. I'm not sure if Crypto.com has CSV integration for Tax Software yet, but that would a really big help.
[OP]
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fooit wrote: I've been looking at these cards trying to assess risks - I think I am going to get the Ruby card as it makes the most sense to me - "invest" and keep "invested" only $200 (value of 2500 CRO coins when I post this message), after 1 year you break even.
With Jade/Green cards it's $2200 "investment" - about 5 years to break even, so there's a risk to loose money.
I am wondering if are you considering to stake 250k CRO coins (about CAD$ 22k now) to get Icy White/Rose Gold cards - how are you justifying the risks if, say, CRO coin will lose 90% of its value?
The card stake can tank into oblivion, doesn't matter you keep the coins there even after six months in order to not nerf the card. Even still, when they tank...don't withdraw.

I admit 250k CRO (and in Jan 500k CRO) is a lot to stomach, but if you can, the card perks (and other perks in the app) are definitely worth it.
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5% cash rebate is nice but you'll have to spend 380k to break even
And what if they change it tomorrow, like Capital One just dropped cashback from 2% to 1.5%...

With CRO 15% down I am considering Jade/Green now, will wait, seems like it can drop more, so less risk to join the club.
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LOL808 wrote: Since they are now officially operating in Canada, they are legally required to issue T5 for any of the interest or divvy income ...
Under canadian law, they don't pay any interest or divvy interest for using the card, nor for staking CRO through the exchange.

They give you CRO, a crypto coin. Since in canada crypto is not considered a currency, it's not subject to any of those rules. It's just considered a digital commodity.

Only once you load a profit back into a bank account can you consider yourself having gained anything currency wise, and as that happens purely between you and your bank, again crypto.com has no responsibility. That earning is up to your bank or you to report.

In the eyes of the law, crypto.com is doing nothing different than selling you some cheap toys at walmart. If you do that at walmart, and than wait a while and those toys suddenly get very popular, and then you go ahead and sell them for a profit.. Are you going to report a capital gain?
Might sound like a silly comparison ,but it's exactly how the law works in this regard. Crypto.com is complying with all canadian laws.
Last edited by Eleventeen on Dec 21st, 2020 8:23 pm, edited 1 time in total.
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Tried an ATM pull today at Libro credit union, who have been reliable to charge no fee's on prepaid mastercards. And can confirm no fee, very easy to pull money. Balance inquiry also works no problem.

So assuming that applies to international use too, US owners can go there for the ultimate FX deal (interbank rates)

Weather this card will be better for ATM pulls internationally for me I dunno, I haven't encountered any international does that don't charge fees, and since my charles schwab 100% refunds those fee's, it's unlikely to be beaten.

But yea it's not such an easy account to get for canadians anymore, so for anyone else this card is the new #1 for international ATM usage (and great for local too if you got no-fee credit unions handy). My ruby card has a $500 limit for the interchange rates than 2% after that, and $500/day. Haven't checked all the limits yet, but it appears to be $500 even for the free version if I read the terms right (website says 200 USD but rules for canada are different, They aren't all clearly filled out in the terms so ill email them to get all the limits for canada.
So if you don't require huge amounts of cash when traveling, it can be better than stack even for the basic free version .. So even if you don't want to invest anything, might be worth signing up for that use. The 1% cash back + interbank rates/ no FX also beats tons of credit cards with annual fees for international payments use. Extremely few in canada have no FX fee and give rewards on top of that.

Also note there is a $25 USD sign up bonus if you get referred and has a fairly low CRO stake requirement.
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fooit wrote: 5% cash rebate is nice but you'll have to spend 380k to break even
And what if they change it tomorrow, like Capital One just dropped cashback from 2% to 1.5%...

With CRO 15% down I am considering Jade/Green now, will wait, seems like it can drop more, so less risk to join the club.
Well the difference in a credit card that devalues it's perks or its points:
Your not earning cash, your earning a coin that's value is purely based on investments, due to its design, its a ton less volatile than bitcoin and most other coins. In the last few years, ya its dipped and jumped as much as 20-30% month to month, but at the end of the day, year to year its value is fairly stable due to its tie to fiat. Since it's value is based on the open market, Crypto.com doesn't really have power to massively devalue it like a bank that controls its points currency with 100% authority.

Plus that credit card devalues so much its not worth? Well that hurts you in several ways:
- Cards worthless, so have to cancel, potential credit hit there
- Hassle of having to call in, move to another card which may not have as much credit limit

This card devalues it's stake benefits to the point you no longer feel it worth? Well you can unstake and cash out, and you keep the card and some of the high tier benefits are kept too like the Loungekey - that's yours lifetime once you got it. Unlimited visits.
No issue if you just stop using it either, it's just a prepaid card so no credit score effects.

So yea while it's entirely possible they may devalue the % return or other perks, it's not much risk after your 6month term is done. And imo it's insanely unlike anything will get worse in the next 6 month. In the last 3 years they have only been improving the perks, they did so at least 4 times now and since they are upping the stake requirements, I bet they will just continue to do so. It's easier and better to do it that way, up the price in a way, grandfather existing customers and keep the perks strong. So early adopters very much get a boon picking up this card/staking.
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Eleventeen wrote: Well the difference in a credit card that devalues it's perks or its points:
Your not earning cash, your earning a coin that's value is purely based on investments, due to its design, its a ton less volatile than bitcoin and most other coins. In the last few years, ya its dipped and jumped as much as 20-30% month to month, but at the end of the day, year to year its value is fairly stable due to its tie to fiat. Since it's value is based on the open market, Crypto.com doesn't really have power to massively devalue it like a bank that controls its points currency with 100% authority.

Plus that credit card devalues so much its not worth? Well that hurts you in several ways:
- Cards worthless, so have to cancel, potential credit hit there
- Hassle of having to call in, move to another card which may not have as much credit limit

This card devalues it's stake benefits to the point you no longer feel it worth? Well you can unstake and cash out, and you keep the card and some of the high tier benefits are kept too like the Loungekey - that's yours lifetime once you got it. Unlimited visits.
No issue if you just stop using it either, it's just a prepaid card so no credit score effects.

So yea while it's entirely possible they may devalue the % return or other perks, it's not much risk after your 6month term is done. And imo it's insanely unlike anything will get worse in the next 6 month. In the last 3 years they have only been improving the perks, they did so at least 4 times now and since they are upping the stake requirements, I bet they will just continue to do so. It's easier and better to do it that way, up the price in a way, grandfather existing customers and keep the perks strong. So early adopters very much get a boon picking up this card/staking.
Is the total outstanding CRO fixed? Do they issue new CRO to pay for the stakes?
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LOL808 wrote: Is the total outstanding CRO fixed? Do they issue new CRO to pay for the stakes?
Do you mean for the upcoming increased CRO requirements?
They grandfather the existing stake and display the tier your earning for what your you originally staked. Forever. For example I have the Ruby card with only 1000 CRO staked, here is how it looks on the app:
http://imgur.com/gallery/CkPZHHv
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Eleventeen wrote: Do you mean for the upcoming increased CRO requirements?
They grandfather the existing stake and display the tier your earning for what your you originally staked. Forever. For example I have the Ruby card with only 1000 CRO staked, here is how it looks on the app:
http://imgur.com/gallery/CkPZHHv
This. The grandfathering is boss. Some of us got icey white on the cheap and was a no-brainer to grab it.
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BTW just signed up for spotify family plan and can confirm we get it free in Canada ( us card would only cover the next plan down) as it's up to 12.99 USD which is more than the family plan costs in Canada. Which is 14.99 cad. It says plus tax but I wasn't charged tax in Ontario. Assuming a certain province where they might have there Canadian hq charges tax, you'd still only pay at most 25 cents at 13% with today's exchange rate.

And the rebate is instant in CRO the moment you sign up as you can see in my previous posts screenshot.

Premium family plan is good for up to 6 people. There requirement is in the same household, but as we know like other services this isn't strictly enforced. Enjoy Smiling Face With Smiling Eyes
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Eleventeen wrote: Do you mean for the upcoming increased CRO requirements?
They grandfather the existing stake and display the tier your earning for what your you originally staked. Forever. For example I have the Ruby card with only 1000 CRO staked, here is how it looks on the app:
http://imgur.com/gallery/CkPZHHv
I was just wondering about the payout for the staking ...

when you sign up for a certain tier like the green/jade tier, you need to stake 25000 cro right now ... and receive weekly payout of certain % ... the question i had was whether crypto just issue new cro's to cover those payout ... or do they already have a fixed number of cro issued and no new cro will be issued ie., no dilution.

the other question i had was whether those perks would be jettisoned as time progresses ... for example, the unlimited lounge access ... will i one day wake up to find its gone and will have to upgrade to the next tier to get it ... ? :lol:

so many questions ...
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Eleventeen wrote: BTW just signed up for spotify family plan and can confirm we get it free in Canada ( us card would only cover the next plan down) as it's up to 12.99 USD which is more than the family plan costs in Canada. Which is 14.99 cad. It says plus tax but I wasn't charged tax in Ontario. Assuming a certain province where they might have there Canadian hq charges tax, you'd still only pay at most 25 cents at 13% with today's exchange rate.

And the rebate is instant in CRO the moment you sign up as you can see in my previous posts screenshot.

Premium family plan is good for up to 6 people. There requirement is in the same household, but as we know like other services this isn't strictly enforced. Enjoy Smiling Face With Smiling Eyes
LOL808 wrote: I was just wondering about the payout for the staking ...

when you sign up for a certain tier like the green/jade tier, you need to stake 25000 cro right now ... and receive weekly payout of certain % ... the question i had was whether crypto just issue new cro's to cover those payout ... or do they already have a fixed number of cro issued and no new cro will be issued ie., no dilution.

the other question i had was whether those perks would be jettisoned as time progresses ... for example, the unlimited lounge access ... will i one day wake up to find its gone and will have to upgrade to the next tier to get it ... ? :lol:

so many questions ...
@LOL808 market cap explained here.

@Eleventeen as I'm on Icey White, my "streaming service" DP's
  1. same as you, Spotify family plan covered (in CAD, wasn't charged sales tax). Signed up.
  2. Netflix - pricing in Turkish Lira, so UHD premium plan 100% covered (within the cap)
  3. Amazon Prime in CAD covered within the cap
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LOL808 wrote: I was just wondering about the payout for the staking ...

when you sign up for a certain tier like the green/jade tier, you need to stake 25000 cro right now ... and receive weekly payout of certain % ... the question i had was whether crypto just issue new cro's to cover those payout ... or do they already have a fixed number of cro issued and no new cro will be issued ie., no dilution.

the other question i had was whether those perks would be jettisoned as time progresses ... for example, the unlimited lounge access ... will i one day wake up to find its gone and will have to upgrade to the next tier to get it ... ? :lol:

so many questions ...
There are 2 places where you can stake.
On the app for the card. There is no interest earned, no payout at all. The benefit is purely access to the card. The CRO is locked in and can't earn interest or do anything else with it. It may raise in value, or drop during your 6 month stake, nothing you can do about that. After 6 months you can remove it at will, move it to the exchange to earn interest, whatever you like. Just keep in mind some, but not all card perks rely on the stake being maintained (Check crypto.com and look at the with/without stake button to see the differences).

On https://crypto.com/exchange
Here yea you earn interest on your stake, how much depending in how much you stake. For below 10,000 it's only paid out at the end of the term, for above 10k, that's where you get the 10% PA and other perks, It might pay out more often, I haven't tested it.

They are completely separate services, unrelated to each other , other than the fact you can link the account to make signing up for the exchange or transfering crypto between them a bit faster.
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Eleventeen wrote: There are 2 places where you can stake.
On the app for the card. There is no interest earned, no payout at all.
My card deposit is currently earning 12% in CRO.
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Are the terms & conditions for Canadian CDC cards available somewhere on their website? Looked but didn't find them.

I didn't realize they have a basic card ("Midnight Blue") that doesn't require you to buy into their ponzi scheme. Website says up to $US2000 free FX at interbank per month.
Does this only apply to card transactions in foreign currency or can you actually hold multiple currencies in the app and exchange between them?
Do they have a weekend surcharge like Revolut?
Can you transfer CAD out to a bank account?
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rhw123 wrote: Are the terms & conditions for Canadian CDC cards available somewhere on their website? Looked but didn't find them.

I didn't realize they have a basic card ("Midnight Blue") that doesn't require you to buy into their ponzi scheme. Website says up to $US2000 free FX at interbank per month.
Does this only apply to card transactions in foreign currency or can you actually hold multiple currencies in the app and exchange between them?
Do they have a weekend surcharge like Revolut?
Can you transfer CAD out to a bank account?
Does this only apply to card transactions in foreign currency or can you actually hold multiple currencies in the app and exchange between them?
Only apply to card transactions in foreign currency. I don't think you can hold multiple currencies and exchange between them.
Do they have a weekend surcharge like Revolut?
No.
Can you transfer CAD out to a bank account?
You can request e-transfer withdraw for money in your fiat wallet. Not sure if we can move money back to fiat wallet once it's loaded to the card.
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