How to Buy Bitcoin in Australia
Investing our hard earned cash can be a tricky proposition. Bitcoin’s irreverent technology has taken the financial world by storm. In this article, we’ll explore all the steps and platforms to buy bitcoin in Australia.
Why Are Bitcoins So Popular in Australia?
It’s safe to say that in the last few years the Bitcoin trading market has exploded in popularity. Almost everywhere you look there’s at least one trading forum talking about it or a website adopting it as a form of payment. It’s proven to be one of the best cryptocurrencies on the market right now and here’s why;
One of the biggest benefits of trading in Bitcoins is that it’s an incredibly volatile market. Although this may seem like a downside it actually works in its favour as prices of Bitcoins can, at times, double or even triple overnight if you’re lucky. So say for example you were to spend $50 AUD on some Bitcoins on Monday. By Friday, that amount might be worth $100 or even $200 if you’re lucky enough.
The fluidity in value of Bitcoins is perhaps the biggest reason why you’ll find so many online investors giving it a try.
Another great benefit of Bitcoins is that they’re an incredibly secure and safe investment. What we mean by that is that they’re difficult to be digitally manipulated by outside sources and in the market, it’s impossible for them to lose even the smallest of value unless Bitcoins themselves become worthless which never happens.
These are just two of the many examples of why people are starting to invest in Bitcoin and changing their cash on the various online trading platforms out there.
Bitcoin – Australia’s Demographic
As you can see the east coast dominates the amount of bitcoin being held and most people are holding for investment purposes, meaning that people see it as a store of value rather than a currency just yet.
More Information about Bitcoin
For those that are not immediately familiar with them, Bitcoins are at their most basic form a system of online payment that complete transactions with no third party acting as an intermediary for the exchange of currency. If you want to learn more, visit our Bitcoin Guide.
What Can You Use Bitcoins For?
One of the best things about Bitcoin’s growing popularity over the last couple of years is that they’ve been adopted by stores and website the world over from Australia, to the US to even the UK. From buying physical items in stores with your smart device or online, you can use them pretty much anywhere now.
For example, you can pay your way into Hollyburton Park in Victoria with Bitcoins. If you’re looking for a fancy picking up a book to read, you can try Polyester Books in Melbourne. You can even buy fashion items from Vera Chan or bikes from Little Mule as they accept Bitcoin. There really is no end to the places you can spend your cryptocurrency instead of hard cash.
A popular use of Bitcoin’s is in CFD trading to make a quick turnaround with your money. But their main use is in online transactions when they’re stored in what’s colloquially known as a ‘Crypto Currency Wallet’.
Cryptocurrency Wallets – Australia
A Crypto Currency Wallet is a piece of software that you can use to store your bitcoins in. They use a system of public and private keys to complete online transactions safely and securely in a simple process. They work by sending currency into a wallet address provided by the recipient. To withdraw the money the person on the receiving end must use a keycode that matches the one stored within the wallet. If the code match then the transaction is complete. It is always recommended to back up your wallet.
But, if the codes don’t match then the money is kept in the wallet until a set period of time before it’s returned to the original sender. So it’s incredibly safe to use as there’s no chance you will send your money to the wrong person and have them take your money without authorization.
How Can I Get Bitcoins?
Purchasing Bitcoins has never been so simple, there’s a number of different ways you can get your hands on them.
Two of the main ways are to use what’s known as an ‘exchange’ or sometimes a ‘broker’, the other is to use CFD’s. Both come with their own advantages and disadvantages to using them to make sure you’re using one that will let you make the most of your initial investment.
For example, if you were to use CFD’s ideally you would be using them to take advantage of the fact that they’re perfect for a quick turnaround on your cash since they’re perfect for monopolizing in rapid changes in the market. So you can deposit some of your cash, increase its net worth and then get it out with a tidy sum as your reward, although just make sure you invest in something that’s definitely going to increase in value.
Another great feature of CFD’s is that they can come with a multiplier, so there are occasions where you could triple your money, or if you make a particularly great market decision you could increase it up to 100 fold.
However, there is some downside to using CFD’s, chief of which is that it’s not for long term investment. This is because of how rapidly the market can change in value, so you could make an investment say at the start of the week and by the end, it could be a total disaster.
Top 10: Exchanges to invest in Bitcoin from Australia
Below, is a list of the 10 best Australian cryptocurrency exchanges to make sure you begin this experience on the right foot!
Buy BTC in Australia using Coinbase
As of 2017, it was available to users in 30+ countries, including Australia. Its simple interface allows newcomers to easily purchase bitcoins while its most popular payment method for Australian customers is buying with a debit or credit card. There is a 3.99% fee per purchase and your cryptocurrency is delivered to your wallet instantly. You can check our Coinbase Review to get more information about this exchange.
- High buying limits
- High liquidity
- Easy for first-time buyers to get bitcoins.
- Instant Buy option available.
- Good reputation
- Low privacy
- No option to make purchases with bank transfer
Buy Bitcoin in Australia with Coinmama
Coinmama is an Israel-based bitcoin broker that specialises in selling bitcoins for credit or debit card to almost the entire world, Australia included. Its interface is also easy to use and you won’t need to verify your personal information if you are buying less than $150 worth of bitcoins, which makes small purchases easy and quick.
However, the almost 6% fee per purchase could be prohibitive to some traders. Nevertheless, if you buy bitcoin with a credit card, you can purchase up to $5000 worth of bitcoin per day (~6,375 AUD) or up to $20,000 worth of bitcoins per month (~25,500 AUD). If you’d like to find out more about this platform, check our Coinmama Review.
- High limits for buying with a credit card.
- Reliable broker
- Fast transactions speed
- High fees to buy bitcoin with credit/debit card.
- Low privacy
Founded in 2013, the Aussie bitcoin start-up CoinJar is one of the most well-known Australian bitcoin exchanges and an all-in-one platform for selling, buying, and managing bitcoin on your phone.
It includes a bitcoin wallet to securely transfer, trade, and hold bitcoin on your phone, a competitive 1% fee (flat) when trading bitcoin, multiple bank account functions to link your bank account or hold different currencies on your CoinJar account, and an EFTPOS card that allows you to withdraw bitcoin as cash at ATMs or spend AUDs or bitcoins at EFTPOS terminal around the country. Plus, it offers a $0 international money transfer system to make quick money transfers anywhere in the world over the bitcoin network in seconds.
- Automatic 2-factor authentication
- Allows you to use and spend bitcoin.
- Low, flat 1% commission.
- Clear interface that makes it easy for newcomers to use (even from mobile devices).
- Offers free EFRPOS card.
- No fees when making a deposit with POLi or BPAY.
- Not open source
- No multi-signature capability to increase security.
- Customer support is quite low, despite the efforts to improve.
Australian Bitcoin Exchange: Independent Reserve
Independant Reserve is another popular Australian Bitcoin exchange geared towards both corporations and traders alike. Founded in Sydney in 2013, it has quickly become a reputed cryptocurrency exchange that operates fully in line with Australian financial services regulations.
They charge a commission that is based on your trade volume over the previous 30 days, and can range from 0.05% to 0.10%. If you are new to bitcoin trading, the commission is 0.5% and goes down by 0.2% with every 15 bitcoins you trade (for 15 bitcoins, the fee is 0.48%, for 30 bitcoins, it is 0.46% etc.).
- Multiple ways to fund your account (SWIFT, EFT, Crypto Capital or POLi).
- Allows you to trade in AUD, USD, and NZD almost for free.
- Fees can fall to 0.1%, depending on trading volume.
- Great liquidity
- Sufficient range of payment methods (POLi, SWIFT, and EFT).
- Strong security features available.
- Its user interface is quite confusing for first-time traders.
- To avoid the 0.5% commission charges one needs to trade high volumes.
- May require manual approval of withdrawals (for security reasons), which could take a few hours.
Coin Loft is an Australian Bitcoin broker (also member of the Australian Digital Commerce Association) that started in 2013 as a means to help Aussies navigate the cryptocurrency market in a simple and quick fashion.
You may use Coin Loft to buy either bitcoin or ether with a credit card, POLi, Flexepin or cash deposit but you will need to give a 5% commission on the purchases Coin Loft makes on your behalf (GST included). The fact that it doesn’t hold a large amount of money the way some other exchanges do allows coin Loft to provide a platform that is less prone to hacking attempts.
- Quick and simple user interface.
- Provides a useful range of payment option.
- The only Australian service that accepts Flexepin as a payment method.
- High fees for cash purchases (5%).
- High cumulative fee for credit card purchases (9%).
Try another broker: AVA Trade
AvaTrade is a licensed broker regulated not only by the Australian Securities and Investments Commission but also in the EU, British Virgin Islands, and Japan. They are operating since 2006 and allow traders to trade over 60 different currency pairs.
All funds deposited by Australian clients are held at ANZ Bank, in a segregated trust account while their customers are also provided with a variety of information and market analysis for free. Depending on your requirements, you may choose from 8 different trading platforms offering all styles of trading. The broker executes more than 2 million trades every month (trading volume over $60bn). Also, it offers an impressive variety of account funding options. Go to our AVA Trade Review to learn more.
Although, technically, VirWox is not a Bitcoin exchange as it was set up to provide users with a currency used in online gaming called Second Life Linden (SSL), which is used in the online virtual world of Second Life, it has been established as a leading independent exchange for digital currency trading after it expanded into bitcoin in 2011.
At the moment, the Australian-based VirWox is one of the very few platforms that allow bitcoin purchases through PayPal but you may need to purchase SSL first and then trade them for bitcoins. However, you may also make deposits with your credit card. Check our Virwox review for further information about this exchange.
Buy Bitcoin CFDs in Australia with ThinkMarkets
ThinkMarkets is one of the most top-rated investment companies in the country and licensed from both the Australian ASIC and the UK’s watchdogs, the FCA (Financial Conduct Authority).
Previously known as ThinkForex, this a popular broker that operates worldwide. The forex and CFD brokerage has two main platforms to choose from. You can trade from the ThinkTrader platform and the advanced MetaTrader 4 platform (50+ instruments available). The user-friendly layouts make using the platforms a breeze via mobile devices, web browser or computer. The Standard account type requires an initial deposit of AU$250.
- Tight spreads on major forex pairs even during volatility.
- Fast withdrawals (24 hours to complete a withdrawal request).
- Variety of payment options (credit/debit card, Skrill, PayPal, Bank Wire, WebMoney, FasaPay, and Payment Asia).
- Multilingual 24-hour support team.
- No FIX API connections (only available to VIP accounts – minimum deposit of $25,000 to have this account type).
- The broker has not created a strong reputation yet.
What’s next For the Australian Bitcoin Market?
If you want to buy Bitcoin online Australia has proven to be an extremely popular cryptocurrency market. For example, in 2010 one Bitcoin was worth less than one-hundredth of an Australian cent, now in 2017 it’s worth at least $10,000.
Although there was a slight dip recently in the price of Bitcoin Australia’s market is speculated to be due another big increase in the next few years.
A great indicator that the Bitcoin in Australia is performing particularly well is that the Australian banking system itself is currently mulling over the idea of creating electronic banknotes based on the idea of Bitcoin.
This push has come thanks to Bitcoin’s security and transparency in its transactions, something most central banks, including the Bank of England in the UK, are keen to capitalize on if they can. If this takes off we could perhaps see Bitcoin’s becoming a regular method of payment in Australia.
So the future of being able to buy and sell Bitcoin in Australia is definitely going to be a stable and very active one if those facts are any indication of how it’s currently performing.
Is it possible to buy Bitcoin anonymously in Australia?
There are 3 ways to purchase bitcoins without having to verify yourself in Australia:
- Buy bitcoins from traders in a peer-to-peer marketplace like LocalBitcoins
- Use ATM machines to purchase bitcoins
- Use an exchange that allows small bitcoin purchases without verification.
Final Suggestions to Buy Bitcoin in Australia
The Bitcoin Australian Dollar (BTC/AUD) market is one that you definitely don’t want to miss out on. It’s becoming the number one digital currency around and with so many platforms for trading and investing there’s definitely some money to be made if you know how.
That’s why with our simple guide you can become the absolute best Bitcoin investor you possibly can.
In parting here’s one final recommendation from us to any newbie Bitcoin AUD traders out there. If you’re going to start spending cash on Bitcoin’s we recommend checking out some of the countless brokers and exchange sites out there. They’re all strictly regulated and controlled so your investments are safe and most of them, like FXGM offer great benefits and help to first-time investors.
There are two main ways to buy bitcoin in Australia (1) from an exchange or (2) using a forex bitcoin broker.
The key distinction between those two is that with brokers you are trading a Contract For Difference (CFD), most of the time. A CDF is an instrument recently created to mimic the price movements of an underlying asset, from gold and stocks to oil and, of course, cryptocurrency.
On the other hand, using a cryptocurrency exchange to trade bitcoin, you are actually trading the digital currency. This means that when you buy some bitcoins, you can transfer them to your own e-wallet or the wallet of a vendor from who you want to buy something. So, in essence, trading on an exchange allows you to own the coins you buy while a CDF gives you the opportunity to profit from bitcoin’s price movements.
For those that want an easy way to buy bitcoin and have no plans to become traders, using a broker might be what you want to do, provided you are prepared to pay a bit more for the brokerage services. But, if you want to trade bitcoin in the future or buy the cryptocurrency as cost-effectively as possible, then choosing a trustworthy and reputed exchange is probably your best option.
How to Exchange AUD to Bitcoin?
The majority of the trading volume in terms of exchanging AUD to Bitcoin comes from BTC Markets exchange, a Melbourne-based blockchain technology company that offers a trading platform for anyone interested in selling or buying bitcoin across Australia, including businesses and professional investors. Nevertheless, there are a few more additional traders that also make trading bitcoins for AUD easy, such as LocalBitcoins, an escrow service that matches bitcoin sellers and buyers (good option if you want to buy small amounts of bitcoins but has much higher prices than regular exchanges). Or you could purchase bitcoins through one of the exchanges that run in Australia (complete list right below), with the help of a bank wire transfer or credit card.
What is the Regulation About AUD/BTC Trading?
Bitcoin has been legal in Australia since 2013, when the Central Bank of Australia issued an opinion that clearly indicated the legality of the cryptocurrency in the country. Due to the country’s International Funds Transfer regulations, each conversion from AUD to Bitcoin (and vice versa) is trackable by AUSTRAC, the government agency responsible for combating the financing of terrorism and money laundering. However, it was not until July 2017 that it was officially confirmed bitcoin will be treated like money in Australia and as such, it is no longer subject to the GST (general sales tax) bitcoins users had to pay twice in the past (once on the purchase of bitcoin and once when it was exchanged for other services or goods subjected to the GST).
There are 3 ways to purchase bitcoins without having to verify yourself in Australia (1) buy bitcoins from traders in a peer-to-peer marketplace like LocalBitcoins or (2) use ATM machines to purchase bitcoins or (3) use an exchange that allows small bitcoin purchases without verification.
How to Decide Whether to Choose an Exchange or Broker in Australia?
If you simply want to sell your bitcoin, using the services of a broker is a good option but if you wish to trade with other users, you will need to find an exchange. Just make sure the exchange you will use accepts the most widely used payment methods in Australia, namely POLi, credit card, cash, and BPAY. That being said, you may also find exchanges that accept alternative payment methods like PayPal.