Recent Posts

It’s RRSP Season in Canada, here’s why you need to start saving now.

It’s RRSP Season in Canada, here’s why you need to start saving now.

It’s RRSP Season, and here’s why you should contribute NOW. It’s February in Canada, which means it’s RRSP season once again. Every year we can save money in RRSP’s, and receive a tax deduction for our contributions. The tax deduction alone makes this a great 

Archiving Old Posts

Archiving Old Posts

We’re looking to restart the CFP blog with new, refreshed and revitalized content. Since the blog’s been around since 2011 there’s a lot of really old, probably not relevant any more, content. Rather than leaving them incorporated into the main content section of the site, 

Why Cryptocurrency and Bitcoin is a scam

Why Cryptocurrency and Bitcoin is a scam

Crypto Technology

The technology behind cryptocurrency (bitcoin being one flavour of cryptocurrency) is actually very sound. It’s based on technology called blockchain which is basically a distributed ledger. Recordkeeping and transactions are kept all over the place and it’s virtually impossible to hack or corrupt. As a foundation, it’s been shown in practice to be sound.

Blockchain technology is being hyped in other industries as well, but for the most part nobody’s found a real, commercially viable application. Insurance, accounting, all sorts of industries have tried different things, nothing’s taken off so far.

So the technical platform, and basis for cryptocurrency actually works, and works well.

Value is variable

Cryptocurrencies are promoted because they’re outside the regular banking system. The idea is that there’s privacy and freedom from not having your money attached to a government or a regulatory system.

That’s a nice ideology, but unfortunately that also means that crytpocurrencies aren’t backed by anything. The Canadian dollar is backed by the government’s ability to tax, and that’s not nothing. And the Canadian dollar is also comparable to other government backed currencies so there’s some expectation that while a dollar might become devalued, it won’t likely go to zero.

Not so with cryptocurrency. The value of cryptocurrency is nothing other than market value – whatever people will pay for it. And what people will pay for a non-tangible is extremely variable – that’s why the value of bitcoin has swung so wildly over recent years.

For those that are not aware of just how speculative something like this is, you should read up on Tulip Mania. Some hundreds of years ago people were speculating on tulip bulbs. And like cryptocurrency, values on what was nothing other than a flower bulb swung wildly. Lots of people made money, lots of people lost money, everyone piled on until it all came crashing down and they were left with……tulip bulbs which are pretty much worthless.

The variability in the price isn’t why cryptocurrency is a scam though – it just means that it’s speculative and closer to gambling than it is an investment.


Mining for bitcoin means running programs on your computer. Under certain conditions you’ll ‘find a coin’ and you get the value of that coin.

I remember when bitcoin first came out. I thought, hey neat, maybe I should try it. The reason I didn’t was because setting up the program was more work than it was worth, particularly when a bitcoin was worth 10 cents. I’d be doing all this work and setup and maybe make a dollar a week.

Today, mining really isn’t viable. The chance of mining a bitcoin is getting extremely small, so you’d be doing all the setup and costs for little chance of reward. Further, bitcoin mining has been taken over by vast commercial interests large enough to affect the power grid of some countries. Your small amount of computing power just can’t compete.

Which means that in years past, you could ‘make money’ on crypto just by mining and getting coins at the cost of the mining. Today that’s not viable so you have to buy cryptocurrency on the market and your only source of profit would be increases in the value of the coins that you purchased. No more free rides.

And again, while this suggests that cryptocurrencies are not good investments, again, this doesn’t mean it’s a scam.


In cryptocurrency, whales are entities (probably individuals) who own a large volume of a cryptocurrency. And in the cryptocurrency sector, whales own a substantial portion of the coins. From Investopedia:

Four bitcoin wallets owned 2.81% of all the bitcoin in circulation in June 2023, according to BitInfoCharts, and the top 100 wallets held more than 15% of all bitcoin.

So who cares? Well, you have a ‘currency’ that’s owned heavily by a small number of individuals. These folks can buy and sell large volumes of cryptocurrency, and those actions can definitely impact the price – up and down. And there’s no regulations to stop them from doing those trades for no other reason than to enrich themselves. So, do you think they’re doing that?

Well, from Coindesk,

While bitcoin ETFs have experienced net inflows of $820 million, bitcoin whales increased holdings by about $3 billion this year, IntoTheBlock said.

So, 0.820 billion people put new money into bitcoin, the whales bought 3 billion of existing inventory. Hmmmmm. What does that mean? I’ve no idea. Well, I could guess but it would be without factual backup.

But I do know that with cryptocurrency, you’re putting your money into a currency that is mostly unregulated, that has a few very heavily invested people, and those people can manipulate the pricing to their advantage and your disadvantage. So you can choose to believe they’re not doing that, or you can choose to believe they are (there’s no real proof either way right now that I could find). I’ll choose to believe they are manipulating the prices – and that means you’re putting your money into something with an expectation of profit, but you’re actually giving some of your money to the whales, and getting nothing in return. That’s close enough to a scam for me.

Education, RESP’s and Insurance

Education, RESP’s and Insurance

The cost of education in Canada is a lot lower than in many other places. Nevertheless, the cost can still be prohibitive for many people. Even with government grants and loans, some forethought and planning are required for most people to ensure their kids can 

Canadian Personal Finance Links

Canadian Personal Finance Links

In years past, all the bloggers were big on sharing links. Links to interesting articles, links to other blog, links to anything interesting. Curated lists of links were a common, often weekly post. That seems to have died down through the years, but I think 

Welcome back!

Welcome back!

CPF has been somewhat dormant lately, but we’re back and hopefully better than ever. We’re the new administrators and we have some big plans for the website. New, current, more analytical and detailed content. More frequent articles featuring grass roots Canadian personal finance content. We’re going to start things off with some big lists of links to really good personal finance websites.

If there’s stuff you’d like to see us research and publish, please comment below – your input is extremely helpful for us – helps us make sure the blog is more about you than us.

So have at it – what are your burning questions about Canadian personal finance?

(also, fyi, our homepage photo is one I took in the bush in November near Cochrane Ontario. No cell phone coverage, just me in the bush enjoying the quiet.)