Between 2020 until now, the rate of 0.01 btc to cad has also undergone dramatic fluctuations. When COVID-19 broke out in March 2020, the price of Bitcoin dropped to 4,200 CAD (0.01 BTC=42 CAD), but after Tesla made the announcement in November 2021 that it had invested 1.5 billion US dollars in buying Bitcoin, the rate skyrocketed to 92,000 CAD (0.01 BTC=920 CAD), a whopping 2,090% increase. In 2022, due to the collapse of LUNA and the Federal Reserve’s hikes in interest rates, 0.01 btc to cad dipped to at least 23,500 CAD (a decrease of 74.5%), and in 2023, subsequent to the approval of the Blackstone Bitcoin ETF, it should rise back to 62,500 CAD (an increase of 166%), with a standard deviation annualized volatility of 85%. It far exceeded the 12% volatility of the Canadian dollar relative to the US dollar exchange rate.
Regulatory events have a very large price direction impact. In June 2021, China’s Bitcoin mining ban caused a 32% weekly decline of 0.01 btc to cad (from 78,000 CAD to 53,000 CAD), and since Canada enacted its Crypto Asset Trading Reporting Regulations in 2023, the trading volume on local exchanges fell by 40%. The diminished liquidity has also increased the bid-offer spread to 3.5% (the exchange spread for 0.01 BTC on the platform Coinbase has increased from 15 CAD to 50 CAD). In 2024, the Bank of Canada maintained the benchmark interest rate at 5%. Depreciation pressure in the Canadian dollar made Bitcoin a hedging tool, which increased 0.01 btc to cad by 58% from the 2023 low.
Technical indicators mirror cyclical trends. Based on 30-day moving average (MA) analysis, 0.01 btc to cad experienced four significant crossover signals between the years 2020 to 2024: The golden cross of MA in April 2021 triggered a 48% price increase in a month, and the death cross of June 2022 triggered a 37% decrease in a month. The RSI (Relative Strength Index) is 58, which is at a neutral level. However, the Bollinger Bands width (volatility measure) is at 15%, indicating that it may penetrate the CAD range of 62,500-68,750 (±5%) in the short term.
Tax and compliance charges are overlaid on the real returns. If a buyer purchased 0.01 btc to cad in 2020 for 42 CAD and sold it in 2024 for 625 CAD, the nominal gain is 583 CAD, the tax payable on capital gains (50% taxable portion at a marginal tax rate of 29%) is approximately 84.6 CAD, and the net gain is 498.4 CAD. On the other hand, buying through the Purpose Bitcoin ETF has a 2% per annum management fee, four-year cumulative erosion gain of 12.5 CAD, but exempts one from the threat of private key loss – in 2023, cases of asset loss in Canada due to hardware wallet failure were 7%.
In the long-term trend, a cyclical rise is fueled by the Bitcoin halving phenomenon. Within 365 days of 2016 halving, 0.01 btc to cad rose by 290%, and subsequent to 2020’s halving, it rose by 540%. If this trend persists after the April 2024 halving, the price will be at 125,000 CAD (0.01 BTC=1,250 CAD) in 2025. Be careful, however, for the chance of a black swan event such as the FTX collapse of 2022 that witnessed the liquidation volume per day reach 2.5 billion US dollars and pushed the price away from the mean by 42%. Now, the average daily liquidity of compliant exchanges in Canada is 120 million CAD, which suffices to meet the exchanges’ short-term demand of 0.01 btc to cad. However, geopolitical tensions or central bank digital currency policies can re-draw the long-term valuation equation.