Bitcoin has become a mainstream cryptocurrency, with an increasing number of people adopting it on the blockchain network. The spark of Bitcoin and crypto trading has also reached Australia, and the firms are positively responding to it by providing multiple ways to trade Bitcoin in the market.
When trading any crypto asset, especially Bitcoin does not only involve selling and buying it. Bitcoin can be traded in Australia using crypto exchange platforms, ATMs, or direct trading with another party.
This guide article will elaborate on the best ways to secure and trade Bitcoin using reliable and reputable platforms. Moreover, it will also explain to the readers the best possible options available to them for crypto trading in Australia.
Several Methods To Purchase Bitcoin in Australia
There are multiple methods to buy Bitcoin in Australia and invest in it. A few of these are discussed below.
- Through Crypto Exchanges
One commonly adopted method to buy Bitcoin is via crypto exchanges. Users can convert their fiat currencies into cryptocurrencies by connecting their credit, debit card, or bank account with the opted crypto exchange.
- Through Bitcoin ATM
Traders can also invest in Bitcoin cash by using Bitcoin ATM. Although more than 200 200 crypto ATMs are installed, finding a Bitcoin ATM can be a task in Australia. The country is almost comparable in size to the United States; still, the number of ATMs is very few. On the contrary, about 2000 Bitcoin ATMs are located only in Los Angeles, facilitating the residents to purchase Bitcoin with cash.
- Through Peer-to-Peer Exchanges
Traders can also utilize the peer-to-peer exchange option for buying Bitcoin. In this way, they can purchase Bitcoin directly from a person in the market. Although users do not commonly practise it, it still has multiple advantages over other methods. These exchanges provide more liquidity to the traders compared to the native exchanges. Moreover, P2P exchanges offer better exchange rates and provide their services at lower costs.
- Through Over-the-Counter Trading
Over-the-Counter (OTC) trading is another standard method of purchasing Bitcoin. It helps traders who aim to buy Bitcoins in massive quantities. These transactions do not involve any order book and occur directly between two parties. Enterprises and large investors who buy Bitcoins in enormous amounts can get benefit from such kind of trading methodology.
Features To Be Considered Before Choosing the Best Place To Buy Bitcoin
Traders should check several features and characteristics before finalizing a platform for buying Bitcoin. Some of them are discussed below.
- Registration of the Platform
It is always preferred by traders to choose a platform that is registered locally. It helps them to avoid foreign exchange charges as they accept the Australian currency and allow local payment methods. Moreover, if one chooses an Australian exchange platform, it will follow the local regulations and be registered under the Australian Transaction Reports and Analysis Centre (AUSTRAC).
While choosing a trading platform, it is mandatory to look at the security features it provides to secure its customers’ funds, such as two-factor authentication or encryption methods. Traders usually prefer platforms that provide cold storage methods for their assets to avoid the risk of scams and hacks.
It is essential to check the transaction charges demanded by the platform before initiating the trade. These charges may include deposit and withdrawal fees, spreads, and trading fees and should be adjusted according to the initial budget of the trader.
- Transaction Limits
One should also check the minimum and maximum limits set by the platform for making transactions. Moreover, the amount of the transaction and the period of the transaction should also be checked by the trader.
- Customer Support Service
An effective customer support service is vital for carrying out a successful trade. Therefore, the trader should check the efficiency and reviews of the customer support service of the platform and if it is based in Australia. Moreover, if one can easily access the platform and how quickly they answer the queries is also an essential factor.
- Insurance Funds
Specific platforms have now started to provide insurance over their customers’ funds. However, to avoid any illicit activity or scam.
Checking the reliability and reputation of the platform is also essential for successful trading. The trader should check the founders, transparency, and the controversial position of the platform before choosing to buy Bitcoin from the place.
- Range of Coins Offered
After successfully trading in Bitcoin, traders may add other coins to their trading portfolio. Therefore, it is essential to check if the platform offers trading in different currencies initially or not before initiating the trading process.
- Other Features
In addition, depending on the conditions and requirements of trade, one can also look for other features of the platform, such as if it allows one to earn passive income on the holdings or if one can use bank cards to carry out transactions, etc.
Bitcoin ATMs Located in Australia
Bitcoin ATMs are considered the ideal equipment for converting fiat currencies into cryptocurrencies. It is the only way that can be adapted to convert cash into crypto coins. Several Bitcoin ATMs installed in bigger cities such as Melbourne and Sydney can be utilized to purchase Bitcoins.
Moreover, traders can buy other cryptocurrencies, such as Litecoin, Ether, and Bitcoin, using these ATMs. These ATMs also allow traders to buy Dogecoin and even XRP. However, one should remember that one can only purchase these altcoins at ATMs as they do not commonly will enable one to sell them. But a few ATMs offer both selling and buying Bitcoins for traders.
Steps to Trade Bitcoin in Australia
Trading Bitcoin in Australia is convenient and easy and can be achieved by following the simple steps discussed below.
- Choosing an Exchange
The first step is to choose a reliable and trustworthy crypto exchange that fulfils all the requirements and demands of the trader. The traders always choose a crypto exchange trusted by most customers, demands fewer charges, owns a significant supply, and owns a large user base compared to a costly platform with a smaller user base.
- Creating an Account
After choosing an appropriate exchange platform, creating an account is the next step. One can start making an account by opening the exchange’s home page and selecting the register option. This begins the process of creating an account. The user has to provide credentials to make the account functional and secure it properly, enabling the tow factor authentication. The account can now be used for trading.
- Verifying the Identity
Verifying the customer’s identity is mandatory to know whether the customers are genuine. For this purpose, most exchanges use the Know Your Customer (KYC) identity, for which the customers have to reveal their identities. This requires the user to provide copies of their essential documents, such as their Identity Cards and residence proof.
- Adding Funds to the Account
After completing the whole procedure of creating an account, the user needs to add funds to it. Users can add funds to their accounts using a credit card or a bank account. This transfers the fiat currency into the exchange account, which can now be utilized in the crypto market.
- Initiating Trade
The user must first place an order on the exchange to initiate the trading procedure. It allows him to purchase or sell Bitcoin at a set price. Moreover, he can also execute a transaction by placing a limit order when the price reaches a certain level.
- Monitoring Trade
After buying Bitcoin in the market, the trader has to keep a continuous check on its price. Look after the price fluctuations in the market and monitor the trades accordingly. Moreover, traders can also set up alerts permitted by most exchanges, which tell about the change in market prices as they go on and off.
Bitcoin Exchanges Based in Australia
There are several crypto exchanges that the inhabitants of Australia, such as Coinbase and Crypto.com, can utilize. These exchanges offer a wide range of cryptocurrencies to trade and are used by millions of people. However, all these platforms have their services, features, and charges. Therefore, the trader should carry out detailed research before choosing anyone.
Swyftx, CoinSpot, ZenGo, BTC Markets, and Independent Reserves are commonly known crypto exchange platforms.
Is Binance Operational In Australia?
The residents of Australia can also use Binance to carry out crypto trading. Many investors buy crypto assets in Australia and then utilize the services provided by Binance to earn additional income through margin trading or crypto staking. Many investors are attracted to the Binance platform as it allows for a wide range of about 600 tokens.
First, one needs to open an account to start trading with Binance. After that, he needs to complete the verification process. This will require the personal credentials of the user in addition to copies of his official documents. After completing the account creation procedure, the user needs to add funds to his account using any supporting payment method. After that, he can conveniently sell and purchase cryptocurrencies using the Binance account.
Buying Bitcoin With Swyftx
Swyftx is a crypto exchange platform based in Australia that provides several benefits and services to its customers, making it easier for them to trade Bitcoin. It helps traders to maximize their capital by asking for lower fees. Moreover, it allows them to make recurring and automatic orders and monitor Bitcoin activity in the market by utilizing price charts.
In addition, Swyftx also provides Demo mode to its new users, where they can practice Bitcoin trading using mock currency and real-time data available. After one has perfectly learned the trading procedure, he can then switch to actual fiat trading.
Storing Bitcoin in Australia
While dealing with Bitcoins, storing them safely and properly is also an essential factor in addition to buying them from a reliable platform. Digital currencies are easier to steal than fiat ones; therefore, safely storing them is necessary. For this purpose, many crypto wallets can be used; however, all have their risks and benefits. A few of them are discussed below.
- Exchange Wallet
An exchange wallet is used by a lot of traders who are willing to initiate Bitcoin trading. This wallet is usually used when trading is carried out via an exchange. Although it is the most convenient method to store crypto but still involves the highest risk. The exchange controls the seed phrase and the private keys if one chooses an exchange wallet. Therefore, the user has no control over his assets and wallet.
- Software Wallet
A software wallet is a better option than an exchange wallet. The investors can have complete control over their wallets and keys if they opt for it. However, they are given a unique code to secure their coins and access them, but it has to be kept private and not shared with anyone. Users can access their software wallets anytime and anywhere as they are available as mobile wallets and desktop wallets.
- Hardware Wallet
The tokens are stored online while using a software wallet, but they are not as secure as a hardware wallet. These physical devices store the crypto coins offline and thus are the most trusted by traders. As these wallets are not connected to the internet, it provides an extra security layer to the system, making them less prone to cybercrimes and scams.
Tax Imposed on Bitcoin Profits In Australia
Cryptocurrencies such as Bitcoin are considered property in Australia and therefore are vulnerable to taxation. This means that capital gains tax has to be paid by the trader who is willing to buy, sell, or trade crypto. This is the tax paid in the profit earned through crypto trading.
A proper guidance plan related to crypto and Bitcoin trading has been issued by the Australian Taxation Office (ATO). It states that if one owns Bitcoin for a year or more, the transactions carried out will be prone to capital gains tax. However, the profits will be treated as regular income if the investor has owned Bitcoin for less than 12 months.
Moreover, a guideline regarding crypto trading and taxation has also been issued by the Australian Securities and Investments Commission (ASIC). It states that government officials in Australia do not regulate crypto and Bitcoin trading as they are not considered legal tender in the Australian vicinity. However, holding an Australian Financial Services License (AFS) for firms that deal with crypto trading is vital.
Is it Safe to Invest In Bitcoin?
Before investing in any asset, it is always advised to conduct thorough research to maximize the profit probability and decrease the chances of risks involved. Some critical factors to be considered before investing in Bitcoin are mentioned below.
Everyone is aware of the volatility integrated with the crypto market. The value of Bitcoin may fluctuate rapidly even in one day. Therefore, one must consider the rise and fall in the price before purchasing Bitcoin.
- Value in Market
Bitcoin is not a standard currency and does not have a specific value. It usually derives its value from speculation and utility in the market.
- Exchange Risks
When one buys Bitcoin and leaves it with a particular platform, it becomes vulnerable to several scams and illicit activities. Cybercriminals try to trap the exchange owners through malicious and fake websites or by providing counterfeit credentials. Therefore, choosing safe and various security layers is essential to protect the funds.
- Uncertain Regulation
As the world is still learning to adapt to cryptocurrencies; therefore the regulations and rules related to them also keep on varying. Consequently, one must also consider the impact of international guidelines and rules on the value and behaviour of Bitcoin in his country before purchasing it.
- Growing Technology
Bitcoin was founded in 2009 and is still growing; therefore, it lacks a proper history and track record, such as other traditional assets making it difficult for traders to make decisions at certain times.
- Wallet Vulnerability
Although it is impossible to hack the Bitcoin network, scammers can still get their hands on the wallets holding these Bitcoins. Therefore, it is advised to choose safe wallets that provide multiple security layers.
- Irreversible Transactions
Before initiating Bitcoin trading, it is also essential to consider that the transactions, once confirmed while Bitcoin trading, cannot be reversed or cancelled. Therefore, one should check twice before confirming any transaction, as it may result in the permanent loss of funds.
- Energy Consumption
Bitcoin network usually operates by using the Proof of Work protocol. This results in high energy consumption and causes pollution, thus causing adverse effects on the environment.
- Technicalities Involved
One needs to thoroughly understand the technicalities and concepts involved in Bitcoin trading before purchasing them. It requires sound knowledge of decentralized finance and blockchain technology and its benefits and risks.
If one is willing to purchase Bitcoin, he should conduct detailed research on all crypto brokers and exchanges in Australia and check all the necessary factors and features. However, it is essential to note that trading Bitcoin involves a risk factor in addition to providing a profit. Therefore, one should look at long-term goals instead of looking for immediate results in trading.