An introduction to Bitcoin
Before considering how to buy bitcoin in Australia and the nature of bitcoin trading Australia, it’s good to know what Bitcoin actually is. In short, it’s an ‘encrypted digital online cryptocurrency’, which sounds rather more complicated than it really is!
Bitcoin is a system of digital only payments. So, despite all those pictures online of a coin with a ₿ symbol on them, you’re never going to hold one in your hands. Instead, you hold the access keys to your bitcoins in a virtual wallet. But it’s not so different to fiat currencies – the Australian Dollars in your wallet for example, which are merely a piece of paper with a promise from financial authorities to pay you an amount. Bitcoin (the system) and bitcoins (the currency itself) were developed to be independent of those financial authorities; governments and banks and this was achieved by utilising a complicated algorithm to enable blockchain technology to form a huge public ledger of all bitcoin transactions worldwide. This transparency and complex algorithm is what makes Bitcoin work as an independent system, maintained by a group of Bitcoin miners, who keep the blockchain and ledger up to date. These miners are the key to crypto-mining Australia and are rewarded with bitcoins for their work.
Bitcoin is an international cryptocurrency, the most well-known of many different cryptocurrencies available and it’s become a big business, with bitcoin trading Australia really taking off in recent years.
Bitcoin trading explained
Once you’ve learned how to buy bitcoin in Australia, you might simply use that for crypto-gambling casino Australia, but there’s a lot more you can do with your bitcoins when you dive into bitcoin trading Australia as, just as with any currency or shares, there is a great potential in bitcoin trading for investment.
Technically, a bitcoin exchange is simply a currency exchange to convert your AUD to BTC and back, whilst a bitcoin trading platform Australia is capable of acting as an exchange but will also allow you to carry out trades. You can also use a specialist broker for crypto-trading Australia.
Bitcoin trading Australia involves, at its simplest, trading in bitcoins with buyers and sellers setting prices for the trades and you’ll be able to set a position to make a profit depending on whether the value of the bitcoins rises or falls (known as CFD trading – contract for difference). Once you truly understand bitcoin trading Australia you can delve deeper into the world of leveraged trading, but this isn’t something for the novice.
Bitcoin trading in Australia
Australia has been fairly progressive in the way it deals with cryptocurrencies. Bitcoin and other cryptocurrencies were declared legal in 2017 regulations and were to be treated as property and thus be subject to Capital Gains Tax. And in 2018, the Australian Transaction Reports and Analysis Centre (AUSTRAC) announced further cryptocurrency exchange regulations requiring registration with AUSTRAC, verification of users, record maintenance and to comply with government financial reporting obligations.
Getting a secure & fair experience with bitcoin trading
You need to be fully aware of the security offered by any exchange or trading app. Obviously, you’re looking for a bitcoin trading platform Australia that complies with AUSTRAC and ASIC (Australian Securities and Investments Commission) for compliance with regulations, unless anonymity is your concern – but for the majority of us looking for the best way to buy bitcoin in Australia and the best bitcoin trading platform Australia, the only privacy we’re concerned with is the privacy of our personal and financial information rather than keeping things private from the government and tax man!
A good bitcoin platform must offer secure SSL webpages, have strong DDoS protection, very strong account and identity verification processes and 2-factor authentication for your account. But not even the best bitcoin trading app Australia can protect you unless you protect yourselves, so you should treat all your bitcoin trading Australia as you would all other financial dealings, including creating strong and unique passwords and using up-to-date security and system software.
It’s also vital, when looking at ways to buy and sell bitcoin in Australia, whether through an exchange or bitcoin trading platform Australia, to get yourself a crypto-wallet. This is where you actually store the digital access codes, called private keys, that enable you to utilise your bitcoins. There are many different available crypto-wallets Australia, both software wallets (known as hot wallets) or the far more secure hardware wallets (also known as cold wallets).
Editor’s recommendation – the best trading platform for Bitcoin in Australia
For newcomers, we’d recommend Coinspot as an Australian-based exchange that lets you buy and sell Bitcoin. It’s fully regulated and wonderfully simple to use when you’re looking at how to buy bitcoin in Australia, with an intuitive and simple interface to have you up and buying in minutes.
However, for the best bitcoin trading Australia experience, giving you the option of buying, selling, and trading – we chose eToro, the world famous trading platform that’s widely used through Europe since 2006. eToro has an Australian arm that’s fully regulated by ASIC. It offers a great trading platform interface with all the opportunities to buy, sell, and trade, including a high leverage of 400:1. And there’s also a great social element to eToro, allowing you to copy the trades of successful investors.
This is how our experts test trading platforms
When we’re looking at the best way to buy Bitcoin in Australia and the best bitcoin trading platform Australia, we subject every site we look at to a detailed set of criteria to assess whether they will be good enough to recommend to you. Primarily, we will look at each exchange or platform for their security, expecting to see comprehensive verification and ID checks, encryption, and full security in place as we’ve already discussed.
After this, we look at the main three requirements for greatness; fees, speed, and ease of use. We look at the fee structure, which we expect to be clear and easy to understand for all, and we look for the overall value for money of the platform after considering any extras or hidden fees. We’ll consider the speed of any transactions carried out as well as the speed of the verification process. And when considering those of you new to bitcoin, wanting to know how to buy Bitcoin in Australia, we will look for an intuitive, simple, yet effective experience. But we will also go into each platform and consider how many different cryptocurrencies they handle in addition to bitcoin, what their customer service is like, how many payment options are offered, and their overall reputation.
When all these requirements are fulfilled, only then will we consider any site as the best bitcoin trading platform Australia or the best way to buy bitcoin in Australia.
Expert tips for bitcoin buying, selling, and trading in the Australia
Now that you’ve had your introduction to how to buy bitcoin in Australia and the world of bitcoin trading, we’d like to share with you a few expert tips – the sort of things we wish someone would have shared with us all those years ago when we first saw the growing buzz over cryptocurrencies and were wondering just how to buy bitcoin in Australia!
Understand what you’re doing!
Simply put, there’s no point even thinking about buying bitcoin or trading if you don’t have an understanding of what you’re doing. And here at bitreviews, we’re all about expanding your knowledge when it comes to Bitcoin and other cryptocurrencies. Explore our simple guides to buying and trading and make sure you’re confident before dipping your toes in the market!
Store your bitcoins safely!
You’re never going to hold a bitcoin in your hands. Instead, what you must look after and store securely are your private keys, the unique codes to access your bitcoins.
You need to get the best possible crypto-wallet to store those private keys and keep your bitcoin access safe and secure. You can get online wallets at exchanges or set up your own hot wallets online or on your computer and mobile device. But for absolute security, look into hardware wallets (cold wallets) that are encrypted devices that need connecting to computers to access your private keys. Possibly the best two brands for hardware wallets are Ledger and Trezor.
Accept that Bitcoin is highly volatile!
One of the big attractions to bitcoin is that there are big profits to be made and that’s because bitcoin is a very volatile currency. But the value of your investments can go down as well as up and over the years, bitcoin has risen hugely but it’s also crashed hugely. It is the definition of a risky investment and you need to understand and accept that before going in to invest, with an eye to just what level of risk you wish to expose yourself to.
Market cap is just as important as price!
A common mistake for new investors is to concentrate on the price of bitcoin, but it’s just as important to look at market caps – how much of any coin is available and how much is in the circulating supply. The closer a cryptocurrency gets to its market cap, the total number of coins allowed to circulate, the more demand there will be and the better your selling price.
Look at other cryptocurrencies as well as Bitcoin!
Diversify, diversify, diversify. Bitcoin may be the big name in cryptocurrencies, but it’s far from the only cryptocurrency available. It’s well worth looking at some of the up-and-coming cryptocurrencies, the alt-coins as they’re often referred to, because these may well have a growth curve that’s better than bitcoin.
Think about your trading strategy carefully!
Just like share trading, crypto-trading is a complex thing that needs to be considered carefully. It’s essential to research, learn, and then put in place a trading strategy.
Work out your position, set entry & exit strategies, set a clear profit (and loss) target when opening trades. Know when you need to relinquish a bad position and stick to your plan, don’t chase after a loss. By doing this, it’s easier to minimise your losses and trade afresh another day. And understand that you’re never going to be able to catch every move in cryptocurrencies, trading is simply too fast. Always understand where the market is and when to bide your time to get in when market conditions are most favourable.
Throughout this guide to how to buy bitcoin in Australia and the best of bitcoin trading Australia we’ve shown you there’s nothing especially complicated or difficult about buying, selling, investing, and trading in bitcoin. The market for bitcoin in Australia is growing rapidly and it’s a great investment opportunity for you to consider. However, we’ve also told you some of the things you should carefully consider when dealing with bitcoin. So, three takeaways to keep in mind:
First, like all investments, you should keep in mind that the value of your investments can fall as well as rise, especially in a currency that has proven to be as volatile as bitcoin.
Secondly, when you’re new to bitcoin it’s essential that you understand what you’re dealing with and we’d always recommend your first steps with learning how to buy bitcoin in Australia should be at a simple bitcoin exchange such as Coinspot and then move on to a trading platform such as eToro Australia once you understand the ins and outs of crypto-trading.
And thirdly, you need to be completely security conscious. Use a regulated site with tight security and use a crypto-wallet that gives you the best level of security such as an offline hardware wallet.