How to buy cryptocurrency in Australia
Buy cryptocurrency in Australia, how do you do it and what is safe?
There are a number of ways to buy cryptocurrency. A couple of methods are listed below:
- Buy direct from someone at a meetup.
- Buy from a private seller online.
- Use an online service that matches you with a seller. For eg LocalBitcoins or Mycelium Local Trader
We would NOT recommend the above methods if you are new to cryptocurrency.
- Use a broker like Coin Loft
- Buy cryptocurrency through an exchange.
For people new to the game, using an exchange is the most common and usually safest method.
Cryptocurrency exchanges
A cryptocurrency exchange is a digital marketplace where brokers or traders can buy and sell cryptocurrency. The exchange acts as the intermediary between a seller (maker) and a buyer (taker). A fee is usually charged for the conversion, much like a brokerage fee in a stock exchange.
A digital currency exchange provider is an individual, business or organisation that exchanges, money (Australian or foreign currency) for digital currency digital currency for money (Australian or foreign currency) as part of operating a digital currency exchange business.
Is buying and trading cryptocurrency legal in Australia?
Short answer. Yes.
An exchange however needs an Australian financial services (AFS) licence issued by the Australian Securities and Investments Commission (ASIC) to operate. This allows the operator to:
- provide financial product advice to clients;
- deal in a financial product;
- make a market for a financial product;
- operate a registered scheme;
- provide a custodial or depository service;
- provide traditional trustee company services.
The full details here ASIC AFS licence.
If you are a digital currency exchange provider, you must be registered with AUSTRAC before you can provide digital currency exchange services. It is against the law to provide digital currency exchange services in Australia without being registered.
What is the difference between a registered exchange and non-registered?
Basically, a registered exchange is one that has satisfied all the laws and regulations pertinent to the country or location in which they operate. Australia has a national set of laws regulating exchanges. Unlike the USA which have national regulations as well as differing state laws.
18 August 2021 – News: ASIC Warning
Registered cryptocurrency in exchanges in Australia?
There are an increasing number of cryptocurrency exchanges which serve the Australian market. Although, it can be difficult to find one that is registered, that suits your needs or one that you can use at all.
Essentially if you are new to the cryptocurrency space we recommend an exchange that:
- is registered.
- is relatively easy to transfer Australian Dollars to.
- is based in Australia.
- has a good reputation.
See our article on Australian Cryptocurrency Exchanges where we explore some of the available options.
Photo credits: André François McKenzie | Unsplash