Whether you live in Australia or elsewhere, buying Bitcoin or any other cryptocurrencies can be challenging. With the numerous “beginner-friendly” guides everywhere, it’s so easy to get confused especially if you’re a novice. Therefore, your best bet is to get quality and reliable information at your fingertips.
The number of Australians buying Bitcoin has increased over time, making it more popular than ever before. As a result, buying Bitcoin as a rookie has also become riskier as there are crooks out there trying to rip off unsuspecting investors. So, you should take your time to study this guide before investing your hard-earned money.
What to Know When Buying Bitcoin in Australia as a Beginner
Bitcoin has experienced gains like never before since it was first launched in 2009. It is a crypto asset that operates on a transparent public ledger called blockchain. The process of buying Bitcoin in Australia is simple if you’re armed with the right information. All you have to do is to find a suitable broker, deposit some funds, and complete the purchase.
Most investors buy Bitcoin to sell at a higher price. Bitcoin is volatile, therefore, its value may rise and fall depending on demand and supply. However, the best way to make profits with Bitcoin may be to hold it for several years. If you won’t be able to trade actively, you may just buy and forget about it. This way, you’re likely to make a good profit when you eventually sell it.
Steps to Buy Bitcoin
If you’re buying Bitcoin in Australia, the steps below can save you stress and time. They are also applicable to most crypto exchanges, brokers, and investing apps. Let’s get to them:
Choose a Platform and Create an Account
The first step is to choose a platform and create an account. To do this, you need a valid photo ID like your passport or driver’s license. According to Australian law, you’ll also be asked to take a selfie to prove your identity. There are several platforms to buy Bitcoin in Australia. You may buy bitcoins through:
- Cryptocurrency Exchange
- Bitcoin ATM
- P2P Crypto Platforms
- Mainstream Brokerages
Choose a Payment Method and Deposit
The next step when buying Bitcoin is to choose a suitable payment method. You can deposit through various mediums such as PayPal, bank transfers, credit/debit cards, etc. Exchange platforms charge differently for these payment channels so be sure to confirm the fees before conducting the transaction.
Purchase your Bitcoin
After making a deposit, you can proceed to buy Bitcoin. You can either choose to buy Bitcoin at the current market price or buy when it hits a particular price (limit order). Also, be wary of the spread and associated fees with buy orders. These fees vary among exchanges.
Transfer Your Bitcoin to a Crypto Wallet
Due to financial mismanagement and hacks, it may be risky to leave your Bitcoin on the same platform you bought it. Therefore, you may opt to store your bitcoins in a hot or cold wallet. A hot wallet is connected to the internet while a cold wallet is not. Cold wallets are generally more secure.
A crypto wallet allows you to have full control of your BTC. You can transfer your Bitcoin to your wallet’s public address with the withdrawal menu on your exchange platform. Ensure your address is correct as transactions made are irreversible.
Other Ways to Buy Bitcoin Online
While there are several ways to purchase Bitcoin in Australia, buying through a crypto exchange is the easiest way for a novice. A crypto exchange is the crypto market where the buying and selling of digital assets occur.
To find a cryptocurrency exchange, you can search for phrases like “cryptocurrency exchange in Australia”. This will help you streamline your options. However, you still need to consider your investment goals and preferred payment method. Below are other ways to buy your Bitcoin:
- Crypto wallet: Cryptocurrency wallets are physical devices or software apps used to keep and manage cryptocurrencies. With this, you can control your investment rather than using a third party. However, as a newbie, you may make irreversible mistakes.
- Bitcoin ATM: The Bitcoin ATM is a physical location where you can purchase your Bitcoin. It involves the use of a debit card or cash. Your Bitcoin will then be transferred to your wallet. However, this method may be more expensive and time-consuming.
- Peer-to-peer (P2P) marketplace: This platform allows you to buy directly from Bitcoin sellers and choose from different payment options including AUD. However, you must buy the specific amount of Bitcoin the seller is willing to sell.
How to Choose a Cryptocurrency Exchange
With the many exchanges available, it’s crucial to know how to choose the right exchange that will make your transactions seamless. Below are some factors to consider when choosing a crypto exchange:
Before you choose an exchange, ensure they have strong security features. Examples are cold storage for your funds and the Two-factor authentication (2FA). They should also provide security updates regularly to beat hackers who are always devising new means of scamming users.
Trusting an online exchange without running a credibility status check on them could be costly. You must consider the exchange’s reputation before you trust them with your funds and Bitcoins. Check for online reviews and see what other users have to say about them.
When buying Bitcoins, you should not have to wait a long time before the trade is executed. If you have to wait unnecessarily long, it may be a sign of low liquidity. Therefore, choose an exchange with high liquidity. This way, trade will be fast and there won’t be a significant change in the market price.
Trading with an exchange that doesn’t comply with Australian laws may put you in trouble with the law. This is a bad start for your cryptocurrency trading journey. Therefore, before you sign up with an online exchange, ensure they comply with all the vital laws including tax laws.
As of today, investing in Bitcoin can be lucrative if you know your way around the system. However, as a newbie, this guide will help you to understand the options you have. You can also seek the opinion of experts who have robust experiences and can give you regular tips and updates on the crypto market.