Capital gain

A capital gain refers to the increase in value that occurs when an asset is sold or disposed of for more than its adjusted cost base. In crypto, a capital gain may occur when a user sells Bitcoin for Canadian dollars, trades one crypto asset for another, or uses crypto in a way that counts as a disposition for tax purposes. The gain is usually calculated by comparing the proceeds from the disposition with the adjusted cost base and related costs.

For example, a user buys Bitcoin with an adjusted cost base of $95,000 and later sells it for $105,000. The $10,000 difference is a capital gain before considering any applicable costs.