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Cryptocurrencies are getting more popular not only in Australia but also in the rest of the world. A few years ago, only the more tech-savvy understood what they were all about and possibly invested in bitcoin or other cryptos that were around. Today, however, the average person knows a thing or two about this new industry because of the massive attention that the mainstream press has given cryptocurrencies.
Majority of cryptocurrencies, including bitcoin and Ethereum had a good run in 2017, and people are hopeful that it will continue this year. If you are looking to invest in cryptocurrencies but don’t have an idea how to do it, don’t worry because we are going to take you through some great options that offer a good range of cryptocurrencies. We are also going to take you through the history of cryptocurrencies so that you know just what you are getting yourself into.
A Brief History of Cryptocurrencies
Cryptocurrencies have been around for a very long time, even before the invention of bitcoin. During the pre-bitcoin years, there were attempts to create digital currencies secured by encryption. Bit Gold and B-Money are two good examples which were formulated but didn’t manage to be fully developed.
In 2008, the mysterious Satoshi Nakamoto, a pseudo for a developer of a group of developers (identity remains a mystery), developed a peer-to-peer electronic cash system called Bitcoin. The project didn’t come to light until 2009, when bitcoin software was made available for the first time and mining began,
In 2009, bitcoin was only mined but never traded, so it wasn’t exactly valued. However, in 2010 someone swapped 10,000 bitcoins for two pizzas, meaning that he had put a monetary value to it. Yes, there was a buyer, and if he’d hang on to them, he would be $100 million richer today.
Bitcoin didn’t enjoy market domination for long. Rival cryptocurrencies emerged in 2011, but this only gave bitcoin more popularity, since their design was based on that of bitcoin, which was open for all to use and improve. The cryptocurrency offered the advantage of greater speed and anonymity.
Fast forward to 2017! We experienced an explosion of cryptocurrencies, with most coins hitting their record high. Just like other parts of the world, Australia saw a significant increase in the interest surrounding the industry, with regulators in the country moving in to regulate the market.
How to Buy Cryptocurrency in Australia: Doing it Right!
If you are looking for tips on how to invest in crypto, the first thing you should understand is where and how to purchase the cryptos. Now there are three ways you can buy cryptocurrency Australia: Through broker websites, person-to-person market places and cryptocurrency exchanges.
We are going to take your through these two, giving you some common examples so that the next time you want to invest in Ethereum, Litecoin, Primecoin or any other cryptocurrency, the whole process will be a breeze.
With brokers, the companies set their price and fee for specific crypto that they can sell for. Most of them have the funds ready, while others work with other brokers to ensure they have sufficient supply. There are many examples of digital brokers that you can access in Australia, including Coinbase.com, coinspot.com.au, Coinmama.com and Coinjar.com.au.
However, one of the most convenient brokers that will get you your cryptocurrency instantly is Coinbase. Although this platform is considered a great option for the newbies because of its easy-to-use interface and friendly fees, it doesn’t offer many options of cryptocurrencies. You can only buy Bitcoin, Bitcoin Cash, Ethereum and Litecoin.
Here’s how to purchase any of the four digital currencies on Coinbase:
Firstly, register an account with the platform by filling in your details and choosing an account type (individual for personal trades and business for organization account). When you are done, you will be asked to verify your phone number, which is also used for 2FA verification.
The next step is setting up your payment method. Coinbase offers two options when purchasing cryptocurrencies: bank transfer and credit card. You might be asked to upload a selfies of yourself holding your credit card for faster verification.
Now, at the top of the page, click “Buy/Sell” and you will be redirected to a page with the cryptocurrency options. Click on your preferred crypto, say bitcoin, and select the payment method, filling in the amount (keeping the fees in mind), and then click on the “Buy Bitcoin” option. You are done! The bitcoins will reflect in your account in less than 30 seconds.
Also known as P2P marketplaces, Person-to-person marketplaces are basically platforms that allow you to interact with cryptocurrency sellers and buy your crypto. They understand that one can easily get scammed, so they offer escrow services, holding funds until the reliever confirms before the cryptocurrencies can be released. Unfortunately, most of the sellers posting adverts only sell bitcoins, but you can find a number of marketplaces where sellers advertise Ethereum, Litecoin, and Dash, among other cryptocurrencies. Good examples of P2P marketplaces include Localbitcoins, CanCoin, and Bisq.
In this case, we are going to show you how to buy cryptocurrency on LocalBitcoins because it’s one of the most popular and easily accessible. It also allows you to choose your preferred payment method.
Although you can choose your preferred seller and initiate the process of buying even without registering an account on Localbitcoins, it’s highly recommended that you sign up one so that you can enjoy the platform’s escrow service. So, start by signing up and going to the “Buy” section.
You will find many sellers categorized by regions, currency and payment methods. The prices will differ from one seller to another, so make sure you go for one who offers a reasonable deal. Check their reputation, which is marked by a percentage. Anything above 90% is good, but the higher the percentage, the better.
Once you have selected your dealer, click buy and you will be redirected to a page with their payment terms and fields where you fill in the amount of cryptocurrency you wish to buy. A chat box will then open as the request is sent to the seller. Make use of the chat, asking for the exact details about payment options. Make the payment and hit the confirmation, and wait for them to release the bitcoins. Don’t worry about losing your money, because the cryptocurrency is held in escrow services, and the platform’s support can help resolve any issues that arise. If the buyer confirms your payments, they will release the bitcoins and your account will be instantly credited.
Cryptocurrency exchanges operate in a rather different way. Here, there are multiple sellers and buyers placing orders simultaneously and then wait for others to agree to the transaction. You have two options when dealing with an exchange: one, you can either check out the sell orders and buy cryptocurrency using fiat currency (for some exchanges) or cryptocurrency (exchanging one crypto to another). Two, you can post buy orders yourself and hope that someone will sell the cryptocurrencies to you. Using this method can be a bit tricky, especially if you are new in the cryptocurrency sphere. You need to first learn how to trade cryptocurrency and how to use exchanges before you can execute orders. Some of great options include Binance.com, Bittrex.com Bitfinex.com.
Being one of the best crypto exchange Australia, Binance offers two trading options to suit both novice and experienced traders. For this option, you need to have cryptocurrency such as bitcoin in your wallet and want to exchange to another, say Ethereum, for maximum returns.
So, you start by creating an account with Binance, verifying your email, and go to the “funds” section. From here you can generate an address to use in order to transfer bitcoins or any other cryptocurrency from your wallet. Once the crypto reflects in your account, you can head to the “basic trading”, where you can access sell and buy orders. If you see a sell order for that crypto you want to buy, you just click and enter the amount you want to exchange it for. If there’s none, you can create a sell order to the currency you want.
But as mentioned above, you have to learn all the ins and outs of trading before you can be comfortable to initiate your first trade. But thanks to exchanges, you can get any cryptocurrency that’s listed easily.
Tips for Choosing the Best Cryptocurrency Brokers, Exchanges and Marketplaces
There’s so much competition out there when it comes to the cryptocurrency market. Some brokers allow you to purchase a large amount of cryptocurrencies but with higher fees. Others, like Coinbase, only allow you to purchase $250 USD worth of cryptocurrencies per day. Options such as Binance don’t accept fiat currency but you can exchange from one crypto to another, say from bitcoin to Ethereum e.t.c.
Choosing the right platform depends on your preferences and whether you want to pay premium prices to access reliable sellers or go for bargain hunting on exchanges. All in all, here are some quick factors to consider, helping you make an informed decision:
Does the platform offer a variety of payment methods?
You see for brokers such as Coinbase, you might only access 2 or 3 payment options, but for brokers such as Localbitcoins, the options could be limitless. Go for what’s convenient for you.
How many cryptocurrencies are offered?
Some platforms will only offer you a small option of cryptocurrencies, especially the top options. Others will extend their support and include a few more altcoins. But with exchanges, you are sure to access a myriad of them.
Does the platform offer a secure wallet?
It goes without saying that exchanges and most market places aren’t secure when it comes to storing cryptocurrencies. We have seen major hacks on exchanges, with the most recent being Coincheck, a Japan’s based cryptocurrency exchange. Consider moving your cryptocurrencies to a wallet once you purchase them. There are lots of online and offline options to choose from.
How’s the verification?
You see, there are platforms that will give you a nightmare when it comes to verification. This applies more to exchanges. Some just require you to verify your phone number and email, but limit you on the amount you can withdraw, while others go a step further to ask for proof of address and other kinds of verification documents.
Is the platform regulated by Australian Authorities?
Australia is one of the few countries that have already laid down regulations, targeting companies involved in cryptocurrencies. Just to be on the safe side, go for one that complies with the regulators to avoid losing your investment in future.
How’s the customer support?
Buying cryptocurrency is a sensitive issue. What if something went wrong in the process? What if your card was deducted but the cryptocurrencies were not credit in your account? The support team needs to be fast enough to address any issues that arise. Go for companies with a good reputation when it comes to customer services.
If you are looking to buy cryptocurrency in Australia, you need to understand what lies ahead. If you are just getting started, the best places to start are brokers such as Coinbase and Coinspot. Some person-to-person marketplaces could also be great options if you use the platforms’ escrow services. However, if you know a thing or two about cryptocurrency trading Australia and how to post buy and sell orders then you can use exchanges. However, if you prefer the exchanges then ensure that you start with the basic trading before you proceed to the advanced trading. Go ahead and buy your first cryptocurrencies and get your deserved share of the market!