How to Buy Bitcoin in
Bitcoin is more than just a buzzword in Australia these days, it’s taking the financial industry by storm, revolutionizing banking as we know it. Cryptocurrency is the digital currency transforming how we interact with money, taking big banks out of the equation altogether (if it succeeds that is).
Whether you consider yourself fluent in crypto or have just begun your search for Bitcoin, our team is here to demystify, simplify, and explore the options for how buying Bitcoin in Australia.
How To Buy Bitcoin in Australia
- Register for an account with Swyftx
- Enable two-factor authentication
- Confirm your identity
- Deposit funds into your new account
- Click the “Trade” link
- Search for Bitcoin and click on “Buy coin”
- Enter how much you want to buy
- Review the details of the transaction
- Click “Buy”
What is Bitcoin?
Bitcoin is the original and most popular cryptocurrency in Australia, and around the world. Bitcoin operates from a decentralized system free from federal governance, rendering a third-party bank obsolete. When you make a transaction in Bitcoin, it’s displayed as an encrypted address, or public key, which offers an added layer of security.
One common and accessible way to buy Bitcoins in Australia is through a brokerage or cryptocurrency exchange that accepts various types of currency. Crypto transactions are always recorded and stored permanently in blocks of data on a digital ledger called the blockchain.
What is Blockchain?
These blockchains are databases that allow information to be added but never deleted. Decentralized networks can record and verify each transaction as well as guarantee transparency, so trust can be created more easily than with traditional banking.
Primary functions of the blockchain:
- Solving the double-spending problem with a timestamp on every transaction
- Reaching an agreement on accurate information to continue the integrity of the chain
- Entrusting a network of computers with your transactions instead of individuals or banks
While there is more privacy than traditional banking, there are some risks involved in investing in a purely electronic cash system. But it is important to remember there are risks involved with any investment.
Since Bitcoin was the first of its kind, let’s go back to the start of the cryptocurrency revolution to fully understand its importance.
History of Bitcoin
The genesis of Bitcoin can be traced back to Satoshi Nakamoto’s paper, “Bitcoin: Peer-to-Peer Electronic Cash System,” published in 2008. Nakamoto explains that digital currency allows for money to be sent directly from one user to another, without having to go through a bank first.
On January 3, 2009, Nakamoto mined the very first Bitcoin block, known as the Genesis block.
New Liberty Standard was the first to set an exchange rate for Bitcoin against the US dollar. Based on the price of electricity required to mine Bitcoin, one dollar equaled around 2,300 BTC in 2009.
The first currency exchanges were established in 2011, and by 2017 Bitcoin stepped onto the world stage and its popularity and worth became impossible to ignore any further in Australia.
Why Was Bitcoin Created?
The need for a cryptocurrency arose from the downfall of the established, and trusted, financial institutions in 2008. These seemingly too-big-to-fail banks were the catalyst for creating the electronic cash system known as Bitcoin, the world’s first cryptocurrency.
With centralized traditional banks, there are third-party processing costs, fines, and international transaction fees. Decentralized cryptocurrency transcends borders and renders the bank an unnecessary middleman.
Bitcoin Pros & Cons
There are many factors to be considered when thinking about investing in Bitcoin. While some worry about cybersecurity, others believe the peer-to-peer network offers an extra level of protection. A hacker would have to overrule and change the time-stamped data within the blockchain, which some say is nearly impossible.
Additionally, the federal financial intelligence agency known as the Australian Transaction Reports and Analysis Centre (AUSTRAC) now monitors the exchange of digital currency for cyber-attacks or organized crime.
Some traders believe Bitcoin’s nuance and unknowns benefit both the long- and short-term investor.
The following are some other Bitcoin pros and cons to consider.
- Peer-to-peer lending
- Public keys
- Permanent proof of work record
- Bypassing banks and mainstream financial institutions
- Bitcoin ATMs
- Market volatility
- Cyber threats
- BTC value stability
Although Bitcoin and cryptocurrency may seem foreign to some, the list of retailers and companies in Australia accepting Bitcoin as payment is only growing.
How to Store Your Bitcoin
Actual Bitcoin units can be stored in virtual wallets or cloud storage. After purchasing your Bitcoin through currency exchange, a digital wallet is usually provided. However, you now rely on this platform’s cybersecurity. Don’t worry, though, as other Bitcoin wallets are available and preferred.
Cold storage, or external USB drives, is the recommended storage method for crypto enthusiasts in Australia. An added benefit of a hardware wallet is the complete anonymity with which you can transact, and you’re only online when buying or selling Bitcoin.
Bitcoin wallet security best practices:
- Regularly backup software
- Keep separate wallets
- Multi-signature transactions
- Store private keys offline
Alternate Ways to Buy Bitcoin
Buying bitcoin can be just a click away when creating an account with one of the accredited cryptocurrency exchanges in Australia. Exchange platforms make it easy to trade cryptocurrency, even if it’s your first time. Regardless of your method for buying Bitcoin, it’s essential to spend time comparing your different options on the market.
After reviewing 100 cryptocurrency exchanges, we found that a few stand out among the rest.
We recommend Swyftx, an AUSTRAC-registered cryptocurrency exchange from Milton, Australia. The exchange offers cryptocurrencies that can be traded with AUD, USD, and BTC. Swyftx should be especially beneficial for beginners looking for a fully accredited exchange, the cheapest trading fees, and the best user experience and technical support.
Coinspot is the next best on our list of the best Australian currency exchanges. Another Australian-based crypto company, Coinspot was launched in 2013 and is a common starting point for the expert and novice alike. You will need to upload a government-issued ID and utility bill, which is a drawback for some.
For the more experienced trader, we recommend the Independent Reserve, another Australian exchange. The premium Independent Reserve account offers insurance protections on your cryptocurrencies.
Create an account with any of these, and you have already completed your first step in buying Bitcoin!
Another option for buying Bitcoin is with a broker. Some retailers sell Bitcoin and other digital currencies for cash. Once your payment is made, the broker sends the Bitcoin to your account and you decide what to do from there.
Brokers are known to be the quickest way to buy Bitcoin in Australia, but the convenience comes with a price.
The first Bitcoin ATM in Australia was installed in Sydney’s Pitt Street Mall in 2014. Bitcoin ATMs, or BATMs, allow buying Bitcoin in exchange for cash or federal currency, even without your government-issued ID.
Integrating Bitcoin ATMs into businesses and public areas encourages crypto transactions in Australia while offering greater flexibility and accessibility to funds without internet or when traveling internationally.
Instead of using a currency exchange platform, the founders intended cryptocurrency to be traded in a decentralized peer-to-peer format. Peer-to-peer exchanges give you more privacy and autonomy over your funds, which holds to the core values of Nakamoto’s philosophy.
When exchanging peer to peer, browse offers and find a seller with a reputable trading score. Contact the seller directly and use an escrow service for added protection.
Accepting Bitcoin as Payment
Any business or individual can accept Bitcoins as payment if you have the right online exchange software. You will also need a digital wallet to store the currency, which can be found in the Apple Store or on Google Play. Accepting payment in Bitcoin is as easy as scanning a QR code in some cases.
As the popularity and general knowledge of Bitcoin increases, so does the list of vendors accepting crypto as payment.
The most challenging way to acquire Bitcoins is to discover new ones through solving complex algorithms, known as mining. The cryptocurrency universe consists of a volunteer network of miners verifying blockchains and transactions.
Bitcoin miners use software to unlock new, undiscovered Bitcoins. There are exactly 21 million Bitcoins to be found, and it is becoming increasingly more difficult as an individual to compete with the powerful and efficient computers specifically designed to mine Bitcoins.
The Future of Finance
Now that you know how to buy Bitcoins in Australia and where to keep it safe, you can find a list of where to spend your crypto using websites like Coinmap.
The cost of just one Bitcoin may be enough to dissuade someone from investing; however, it’s predicted that its value will only increase. You can, however, purchase a fraction of a Bitcoin. A Bitcoin fraction is appropriately considered a “satoshi.”
Although there is some risk associated with cryptocurrency, it’s important to remember there is a risk involved with any investment. Moreover, Bitcoin was the response to a failed banking industry.
The financial crisis of 2008 destroyed collective trust in the centralized financial industry. The future of how we handle money may not include a federal third-party institution at all when Bitcoin allows for the bypassing of traditional banking systems.
Cryptocurrencies compel us to reimagine our relationship with money. Bitcoin Is an exciting and worthwhile investment to those looking for more transactional autonomy and anonymity.