There has been a lot of hype around Bitcoin for the last couple of years, and with good reason. If you are interested in this cryptocurrency and wondering how to buy bitcoin in Australia. Meanwhile, here is a detailed guide for buying and trading Bitcoin in Australia.
What Is Bitcoin?
Invented and launched in 2009 by Satoshi Nakamoto, Bitcoin is a decentralized digital currency and the first of its kind ever to hit the market. Although it is not issued by any government body, Bitcoin acts as a unit of account, store of value, and medium of exchange.
Transactions are made online on a peer-to-peer network and do not require clearing from a central authority or server. Thanks to this decentralized verification system, banks can transfer funds to each other at lower rates.
Factors to Consider When Buying Bitcoin
If you are planning to buy Bitcoin in Australia, you should consider several factors like your preferred method of exchange and the type of investment platform you will use. There are several ways to buy this cryptocurrency in Australia. They include:
There are more than 100 Bitcoin exchange platforms in the crypto market. When you use such a platform, you are basically trading with other investors. The exchange moved between buyers and sellers, which means the platform must have enough liquidity.
If not, users could find it difficult to enter or exit the market at a favorable price.
Many Bitcoin exchange platforms are unregulated and so do not offer you any protection should you get scammed.
Suh unregulated platforms may also not support AUD withdrawals and deposits, forcing you to deposit and swap other tokens for Bitcoin. If you are going to buy Bitcoin through an exchange, you should first check that it is regulated.
Lastly, you can buy Bitcoin through a CFD broker. This option does not allow you to own tokens. Instead, you only speculate whether the value of the cryptocurrency will fall or rise.
Buying Bitcoin Safely
Bitcoin, like any other investment, carries risk. You can manage this by being strategic and taking precautions against fraud and loss. Here are some tips to help you buy Bitcoin safely:
- Avoid Investing Large Sums: Cryptocurrency is a volatile market. Try not to invest all of your capital in Bitcoin and think of diversifying your portfolio to limit your exposure. You can check out other assets like index funds and stocks.
- Check for Regulation: While Australia does not require Bitcoin exchanges to hold a license with ASIC to operate, try to find one with ASIC regulation for your protection.
- Avoid Peer-to-Peer Transactions: These transactions are very risky because there is no one to turn to when you get scammed.
Even if you are really itching to buy Bitcoin in Australia, hold off on doing so until you have done your research.
Remember that investing in Bitcoin carries some risk and you should be prepared to protect your capital. Overall, the best way to approach this venture is to hold long-term.