Bitcoin was introduced in 2009 by the alias Satoshi Nakamoto. In the digital market, the most significant and oldest currency is Bitcoin. Bitcoin is a type of dispersed electronic currency developed to give a feasible substitute to conventional flat currency. The bitcoin transfer process is different from the centralized process of bank transactions as you can transfer your bitcoin from a peer-to-peer account. Your transactions of bitcoin are being managed on the blockchains by the miners to verify the transaction.

Is Bitcoin safe for Australians?

Bitcoin is a digital currency with many pitfalls regarding its uncertainty. Still, it is safe for you to invest at this time as Bitcoin has become a mainstream investment in the market. It is still new to most people, and maybe you are one of them. So, if you are keen to invest in Bitcoin and residing in Australia, you will be pleased to know that Bitcoin is legal in Australia. In short, you still have an opportunity to do a lot with it as it is not linked to the Australian financial market. It is not regulated by the government and even not affected by the government remotely.

But once purchase it, you can transfer the Bitcoin to AUD., and you have to follow Australian tax regulations on Bitcoin. You will always need to learn more about the tax regulations on bitcoin by ATO. The use of Bitcoin has become prevalent in Australia to use it in various things, starting from paying for your groceries, used by the retailers. Business people accept payments as bitcoin for services and goods if they afford a bitcoin wallet to store or receive the currency. As an investor, there is a market opportunity gap in the potential of Bitcoin. According to research by the Independent Reserve Cryptocurrency Index (IRCI), it is estimated that about 16.8% of Australians own Bitcoin.

Why you pay tax on Bitcoin?

Initially, Bitcoin was utilizing in the transactions to avoid tax implications. But the governments caught on, and it was Understood that Bitcoin could be used for illegal activities, so the tax authorities implied tax in Australia. So, the government regulates its transactions as Bitcoin is regarded as intangible property and asset. Some of the bitcoin transactions are taxable:

  • Bitcoins are sold and mined by you to a third person.
  • Bitcoins that you have purchased from somebody to a third party.
  • To make use of bitcoins, purchased or mined from someone to buy services or goods.

The Bitcoin transaction that you have mined are taxable as business or personal income where Bitcoins were purchasing from somebody are taxable as investments in an asset.
If you have Bitcoins for less than a year, you are liable for short-term capital gains tax. But if you held bitcoins for more than a year, it will make you possible for long-term capital gains.
Bitcoin is not an investment, but it is only a means to park the money as you collect euros or dollars to buy Bitcoin. So, what should you do?

Being an Australian, you need to buy from an Australian Bitcoin exchange to have a safe investment in Bitcoin. However, there are ample choices for you when you select a bitcoin exchange to have it from the Australian platforms or worldwide. Then, what should you do? Either buy Bitcoin from an Australian business or a foreign platform? So, to help you choose, keep in view the pros and cons of purchasing from an Aussie exchange.

Pros

  • The Australian Bitcoin exchange and platforms must be regulated, and it must comply with AUSTRAC’s CTF/AML reporting obligations.
  • You can generally purchase Bitcoin with AUD.
  • The Australian Bitcoin exchanges platform must support local payment methods, as BPAY and POLi Payments.
  • You must have access to local customer support. 
  • You must have better customer protection if your deposits are missing.

Cons

  • You cannot trade Bitcoins anonymously as you will have to provide your personal to Australian exchange details as proof of ID.
  • The overseas will get much better liquidity given by some more prominent platforms.
  • AUD to Bitcoin prices is frequently higher than USD to Bitcoin prices, which means that you sometimes have to pay a premium to purchase AUD directly.
  • Some services are not provided to customers on the Australian exchanges—for instance, 100x leverage margin trading and many altcoins.
Irrespective of whether you will choose an overseas-based or Australian Bitcoin exchange, you have to ensure that you analyze various options before selecting that which platform needs to use.

Is Bitcoin Safe?

If you consider to some extent to buy Bitcoin is more like buying any other kind of currency. But you need to be careful when the price of Bitcoin rises and falls compared to the other currencies.

It is safe to invest in bitcoins than the typical investment in which you have to place coins yourself or give them to a third party. Then there is another precaution that if you hold Bitcoins yourself, then there is a risk that you may not be able to store them appropriately and will lose them ever. But if you will let a third party hold Bitcoins for you, they will be hacked, and unlike that of storing stocks or dollars, as once your coins will be hacked, they cannot be replaced easily, so you need to choose a trusted Bitcoin exchange platform.

Start your Bitcoin investment?

Investing in Bitcoin seems to be risky, and you will be uncertain before your very first move. But this article has provided you with all the relevant information that it is safe to invest in Bitcoin in Australia. Moreover, Bitcoin trading is somewhat you should learn about, mainly provided that Bitcoin has great potential, and it may become a leading currency in the financial world. The first step is the most important and biggest one. So, do it today, choose the top Bitcoin exchange, and invest in the Bitcoin market in Australia.

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