Bitcoin was launched in 2009 as the world’s first cryptocurrency. Since then, it has become the most commonly held digital asset in Australia.
According to some reports, around 33% of the population currently own or have previously owned cit. Of them, roughly 71% (or around 4.5 million people) have invested in Bitcoin. Many of them are business owners, with some seeing crypto as a long-term investment, while others are interested in its potential role in payments, international transactions, or portfolio diversification.
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Whatever your motivations, if you’re new to crypto investing, you might not be familiar with the process. But don’t worry, we’ve got you covered. Here’s our guide on how to buy Bitcoin down under.
Why Are Australian Business Owners Buying Bitcoin?
There are several reasons why Australian business owners are increasingly paying closer attention to Bitcoin.
Many view it as a digital asset that can complement their existing traditional investments of shares, property, or cash reserves. Others appreciate that Bitcoin operates independently of governments and central banks, which gives them more control over it.
The great thing about this cryptocurrency is that it is now very accessible. Indeed, Australian investors can now purchase Bitcoin through regulated cryptocurrency exchanges that use Australian dollars. For many, this makes the process familiar and straightforward.
Additionally, for businesses that regularly deal with international markets, Bitcoin can also offer an alternative way to safely move value across borders as and when required.
Where Can You Purchase Bitcoin?
One of the first questions business owners have when investing in crypto for the first time is where to buy it. Thankfully, Australia has several reputable exchanges that allow users to buy Bitcoin using AUD.
When comparing platforms, it's worth weighing up the following factors:
- Security features
- Transaction fees
- Ease of use
- Customer support
- Payment options
- Regulatory compliance
Many Australians choose platforms that offer local support and comply with Australian regulations. That’s why they decide to purchase Bitcoin from bitcoin.com.au.
Whichever platform you decide to use, make sure you spend some time reviewing the platform's features and understanding how Bitcoin purchases are processed before creating an account.
What Do You Need Before Buying Bitcoin?
Back in the day, it was quite a complicated process for businesses to buy Bitcoin. But today, the process is similar to opening a traditional bank account.
Indeed, most cryptocurrency exchanges require users to complete identity verification before trading. This process is known as Know Your Customer (KYC) verification.
Typically, to do this, you'll need:
- A valid Australian driver's licence or passport
- Personal contact details
- A mobile phone number
- An Australian bank account
The verification process can often be completed online in a relatively short time, although the processing times can vary by provider. However, once approved, you'll be able to fund your account and begin buying Bitcoin.
How Does the Bitcoin Buying Process Work?
If you’ve never bought crypto before, you can be forgiven for thinking the process might be complicated. However, it is actually quite straightforward. Here is an overview of what to expect.
Step 1: Create an Account
Register with your chosen cryptocurrency exchange and complete the identity verification process.
Step 2: Deposit Funds
Transfer Australian dollars into your account. Most platforms allow you to do this via a bank transfer. However, others offer other payment methods, such as PayID.
Step 3: Choose Bitcoin
Once the money has been deposited in your account, you can then search for Bitcoin in the list of available cryptocurrencies. This is commonly listed under the ticker symbol BTC.
Step 4: Enter Your Purchase Amount
After selecting BTC, you need to decide how much to invest. One advantage of Bitcoin is that you do not need to buy a whole coin. Instead, investors can purchase fractions of Bitcoin based on their budget.
Step 5: Confirm the Transaction
The last stage of the process involves reviewing the transaction details, including fees and the amount of Bitcoin you will receive. Once you have confirmed the transaction, the Bitcoin will be added to your account. Often, this overall process can be completed in less than an hour.
Where Should You Store Your Bitcoin?
After purchasing Bitcoin, you'll need to decide where to store it. Most exchanges provide built-in wallets that allow users to hold Bitcoin within their account. This provides a convenient option that may suit many beginners.
That said, some seasoned investors choose to transfer Bitcoin to a private cryptocurrency wallet, because this provides them with greater security and control. These wallets can either be “hot” or “cold”. The differences between them can be summarised as follows:
Hot Wallets
These wallets remain connected to the internet. They are often available through mobile apps or desktop software.
Cold Wallets
Cold wallets store cryptocurrency offline using specialised hardware devices. Many long-term investors prefer this option. Mainly because it reduces their exposure to online security risks.
How Is Bitcoin Taxed in Australia?
If you want your business to invest in Bitcoin, you should be aware of the tax implications of doing so.
The Australian Taxation Office (ATO) generally treats Bitcoin as a capital gains tax asset. This means profits generated from selling crypto may be subject to tax. Additionally, other tax considerations may also apply, depending on how the digital asset is used within a business.
To fully understand your obligations, it is worth seeking professional advice from an accountant or tax professional who is knowledgeable about cryptocurrency. You are also recommended to maintain accurate records of all purchases, sales, and transfers. Doing this will make your tax reporting much easier.
What Are The Risks of Investing in Bitcoin?
Like with any investment, Bitcoin carries an element of risk. The most obvious of which is price volatility. You should be aware that the cryptocurrency’s value can fluctuate significantly over short periods. Sometimes by substantial amounts.
Additionally, given that Bitcoin is both decentralised and digital, it is a prime target for cybercriminals. Here are some steps you can take to protect your business.
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