Canada Bans Crypto Political Donations Nobody Made Anyway

Canada's federal government has introduced legislation that would prohibit cryptocurrency donations to political parties, candidates, and third-party election advertisers, effectively closing a fundraising channel that has seen almost no use since it was allowed in 2019. It's a bit like banning the use of flying cars because nobody actually has one—but hey, regulatory caution has never been stopped by a lack of evidence.

Bill C-25, known as the Strong and Free Elections Act, classifies crypto alongside money orders and prepaid cards—payment methods considered difficult to trace—and would ban all three across Canada's federal political system. The restrictions would apply to registered parties, riding associations, candidates, leadership and nomination contestants, and third parties involved in election advertising. Nothing says "we take this threat seriously" quite like grouping Bitcoin with gift cards and money orders from the 1990s.

Canada first allowed cryptocurrency donations in 2019 and treats them as non-monetary contributions. However, no major party ever made public crypto donations, and none were made public before the 2021 and 2025 federal elections. Crypto donations were not eligible for tax receipts, making them unpopular among donors. Apparently, even degens have limits, and "no tax write-off" is apparently one of them.

Initially, Chief Electoral Officer Stéphane Perrault favored regulation but not a ban. In a June 2022 report, his office advised reporting and receiving all contributions from crypto because it could never distinguish between larger contributions (as little as CAD 200) made by a single person. By November 2024, Perrault favored a complete ban due to crypto's anonymity and the difficulty of identifying its real participants. Nothing like watching someone go from "let's just keep an eye on it" to "burn it all down" over the course of two years and several existential crises.

Bill C-25 is Canada's second attempt at a ban. Bill C-65 had similar provisions but lapsed when Parliament was prorogued in January 2025. The new bill has passed its first reading and requires committee approval, Senate approval, and royal assent before becoming law. If at first you don't succeed, try again—or just wait for prorogation and reintroduce the same thing. Classic Canadian parliamentary innovation.

Recipients of banned crypto donations would have 30 days to return, destroy, or convert and return the coins to the Receiver General. Administrative penalties could reach up to twice the donation's value. Maximum fines for individuals would rise from CAD $1,500 to CAD $25,000, and organizational fines from CAD $5,000 to CAD $100,000. That's right, you could face a $25,000 fine for receiving a donation that nobody was making in the first place. Peak regulatory theater.

Canada's ban on cryptocurrency donations comes amid a broader crackdown on financial crime. FINTRAC has revoked a total of 50 MSB registrations, including 47 since the start of the year for anti-money laundering violations. Finance Minister François-Philippe Champagne said the crackdown marks "a significantly increased pace of action."