Australians are growing fonder of cryptocurrencies by the day. Over 3.3 million of them now hold cryptocurrencies as part of their investment portfolios. So how do they make their digital currency purchases? Below are the nuts and bolts of the cryptocurrency purchase process in Australia.
AUSTRAC kicked off its anti-money laundering and financial intelligence mandate in 2018 and has registered 312 cryptocurrency exchanges. However, the Australian government has a friendly stance towards the nascent space, making cryptocurrency investing 100% legal.
That said, Cryptocurrencies were declared legal and subject to income and capital gains tax in 2017 by the Australian Taxation Office (ATO).
How to buy Crypto in Australia guide
Generally speaking, we recommend CoinSpot as Australia's best cryptocurrency exchange. They have the largest user base in Australia with over 1 million accounts, which is the most out of any cryptocurrency exchanges in Australia by a wide margin.
Below is a simple guide to help you make your first step to buying Crypto in Australia with CoinSpot:
1. Create a crypto exchange account
The cryptocurrency exchange account creation process is easy. Using a secure internet connection, navigate to a secure link for CoinSpot , click 'create account' and input your username and unique password.
Complete your 2-factor authentication (2FA) process and verify your email account. Some accounts may require more information for KYC and AML verifications. Worry not, though. This process will only take a few minutes of your time.
Some of the data that they may ask to wrap up this process includes:
Your email address
Proof of residence as selfies where you are holding your passport or driver's license
2. Select your payment method
To complete the account opening process, you will need to link your account to a bank account to make AUD deposits and withdrawals. While you can send direct AUD deposits to your trading account from your bank account, PayID/Osko and Poli deposits and withdrawals will accrue fewer charges.
Then, send your preferred AUD deposit to your new crypto trading account. You can connect to CoinSpot with the following bank accounts:
You may need a crypto wallet. While most exchanges do observe high-security measures, leaving your cryptocurrency private keys on an exchange's wallet on a long-term basis increases your investment risks.
Use hot wallets such as MetaMask for quick and free private key storage. Long term hodlers should purchase secure cold wallets from reputable sellers such as Ledger, Trezor or KeepKey.
That said, CoinSpot has passed several security audits and I personally keep my coins on their exchange.
4. Buy the cryptocurrency of your choice
If you have deposited Australian Dollars into your CoinSpot account successfully, you are now ready to buy crypto.
Ensure that you have adequate AUD funds to cover your transaction costs. Cryptocurrency purchases are not reversible because blockchain records are immutable. Watch out, therefore, for asset selection or order quantity errors.
Preview your crypto purchase's value and only buy if you are content with your asset's price tag. Double check all details and click 'buy' to wind up the transaction. Finally, move your crypto assets to your wallet if your intention is long-term holding.
How to choose the best place to buy crypto in Australia
When making a digital currency exchange selection, you should consider its ease of use, customer reviews, and transaction fees. Its security, payments methods, number of altcoins on offer and support of Aussie dollar purchases will also have an impact on your overall trading experience.
Some of the questions that you should have answers to when choosing an exchange platform include:
What is your crypto investment and trading strategy? Are you a long term hodler and are only interested in major coins such as bitcoin? Are you an active trader and have an interest in trading altcoins? Active traders should pick exchanges that have high liquidity, trading volumes and advanced trading features and tools.
Are you comfortable undergoing identity verification? All centralized registered exchanges have KYC and AML compliant user verification procedures. If you want to maintain privacy, use decentralized exchanges instead.
Cryptocurrency exchange selection tips
Your expertise in the digital currency sector will highly impact your cryptocurrency purchase experience. For this reason, beginner investors should work with exchange platforms that accommodate their need for an easy-to-use interface.
Exchanges such as Swyftx have demo accounts that will significantly ease your crypto trading learning process. Easy Crypto, on the other hand, has an easy-to-use platform interface for beginner traders.
Intermediate traders will find exchanges that have a wide selection of coins more suitable. Tools such as margin and leveraged trading will be a bonus. CoinSpot, for instance, has a wide variety of altcoins on offer.
The advanced trader will go for platforms that have features such as cryptocurrency derivatives. These high-speed crypto products are a favourite for risk taking, deep liquidity demanding and high-volume trading users.
I spent 5 years as a Commercial Lawyer in Australia before stumbling across the innovations behind Bitcoin and the cryptocurrency space. Ever since, I have been committed to learning more and educating the broader Australian community about Bitcoin, hard money, investing and decentralized finance.
Crypto Ranking Australia is built to deliver the best cryptocurrency comparisons and reviews for traders and investors in the country. All content on www.cryptoranking.com.au is provided solely for informational purposes only and should not be misinterpreted as an endorsement to buy, sell or trade and cryptocurrency or product we recommend.