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Bitcoin has attracted increasing attention in recent years. Here's our guide on how to buy bitcoin in Australia.
Investors looking for decentralised assets (and potentially major gains) in a post-COVID-19 Australia are turning in droves to cryptocurrencies.
Bitcoin has particularly interested dip-buying Aussies as its price has fallen 70 percent since its record high in November 2021. Now, in Q3 of 2022, the cryptocurrency market seems to be stabilizing somewhat. As a finite resource, its volatility is proving exciting for market watchers.
In fact, according to one 2021 survey, an estimated third of all Australians under the age of 50 own or have owned digital currency.
For those interested in jumping into the crypto space, the Investing News Network has put together a step-by-step guide on how to start buying bitcoin in Australia — and how to do so safely.
How to buy bitcoin in Australia?
Bitcoin is a decentralised digital cryptocurrency not issued under the authority of a government.
As a digital unit, each bitcoin transaction is made online via a peer-to-peer network. Transactions are then collected into blocks, with new blocks attached to previous blocks — hence the term "blockchain."
More and more places in Australia are accepting bitcoin as payment, although this is considered somewhat risky due to its volatile price fluctuations, as we’ve seen this year. Many investors prefer instead to simply hold bitcoin for the long term.
There are a few different ways to purchase bitcoin in Australia. These include buying from a bitcoin cryptocurrency exchange, using a bitcoin broker, or choosing to use a peer-to-peer exchange.
Here's a quick look at how to get started:
- Pick your platform — Start by selecting a platform to purchase bitcoin. There are various options available in Australia, each with different associated fees. Researching and comparing platforms is key to selecting the features that will best suit your personal situation. Some popular options include eToro, Coinbase and Binance.
- Register your account — Register your account with your chosen cryptocurrency exchange. Typically, creating your account will involve verifying your email address and identity.
- Determine and deposit your funds — After verifying your account, you can select from a range of payment methods to begin depositing funds. Options could include a bank transfer, debit card, or credit card. Navigate to the "buy," "trade" or "purchase" section of the website or app.
- Finalise your purchase — Verify your details and complete your purchase. Congratulations — you've purchased bitcoin! Your bitcoin will typically be sent to your account.
How to safely hold bitcoin in Australia?
After making a bitcoin purchase, how can it be stored? Buyers have a few choices:
Use a crypto wallet
In Australia alone, there are many cryptocurrency wallets on the market. A crypto wallet, sometimes known as a digital wallet, is a software program that allows users to store and make transactions with cryptocurrencies like bitcoin.
A crypto wallet has a private key that enables the owner to access their stored funds; it also has a public key that functions like a bank account number, enabling other people to send digital funds to the wallet.
Use a hardware wallet
Sometimes called "cold storage," a hardware wallet stores cryptocurrencies completely off the internet. These devices look like and function similarly to a USB stick, and are used to store users' private keys for bitcoin.
In order to trade cryptocurrencies held in a hardware wallet, owners must move the coins to an exchange, which comes with some security risks.
Hold on an exchange
If setting up a crypto wallet is too much of a hassle for you, it's also possible to store cryptocurrencies in a wallet connected to the same exchange you bought the coins from.
This option isn't usually recommended by crypto experts, as it means you as the coin owner don’t control the wallet's private key — meaning you don't completely own your cryptocurrency. It also makes bitcoin holders a target for thieves, and since bitcoin is a decentralised currency, there is little hope of recovering it once it’s stolen.
What are the steps for selling bitcoin in Australia?
Bitcoin is a compelling purchase, but eventually, all investments reach an end.
When it's time to cash out, you must first decide whether you want to sell your bitcoins for fiat money (such as Australian dollars) or trade them for another cryptocurrency. Here's how the process can be completed:
- Log in to your account on your preferred cryptocurrency exchange.
- Deposit your bitcoins into your cryptocurrency account.
- Select the amount to sell and finalise the process.
- Either withdraw your Australian dollars or transfer your new digital currency into your crypto wallet.
Alternatively, if you have a large amount of bitcoin to trade or sell, you can use one of 67 bitcoin ATMs around Australia to quickly make the change to cold, hard cash.
For more on bitcoin in Australia, click the link below:
This is an updated version of an article first published by the Investing News Network in 2021.
Don't forget to follow @INN_Australia for real-time updates!
Securities Disclosure: I, Matthew Flood, hold no direct investment interest in any company mentioned in this article.
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