How to Start Investing in Bitcoin in Australia: A Beginner's Guide
Investing in Bitcoin can seem intimidating at first, especially with all the technical jargon involved. However, it’s much simpler now, thanks to dedicated Bitcoin-only exchanges like paybtc.
This beginner’s guide will walk you through the essentials of getting started with Bitcoin, from selecting a secure wallet to store your coins, to making your first Bitcoin purchase.
What Is Bitcoin and Why Are So Many People Investing in It?
Introduced in 2009 by anonymous developer(s) Satoshi Nakamoto, Bitcoin is a decentralized digital currency you can store, send, and receive without involving an intermediary such as a bank. Due to its decentralised nature, Bitcoin isn’t governed by any institution; instead, Bitcoin operates on a distributed network of participants. This means no single entity can control Bitcoin, making it an incredibly robust digital monetary system.
Any Bitcoin transaction made is stored on a secure public ledger called the Bitcoin blockchain, which is accessible to everyone. This ensures transparency when transacting in the digital currency.
With its verifiable limited supply of 21 million, Bitcoin is the only asset in the world with absolute scarcity. This, combined with growing demand, has driven its astronomical rise in value since its launch.
Most view Bitcoin as a store of value for the long term as it can hold its purchasing power over time, unlike fiat currencies, which lose value due to inflation. As a result, many of its holders consider Bitcoin a superior form of money.
In addition, major financial institutions are also investing in Bitcoin to diversify their portfolios, benefit from the potentially higher-than-average returns, and offer their clients alternative investment options. This doesn’t come as a surprise given that Bitcoin has been one of the best-performing assets of the last decade.
With Wall Street now being a significant Bitcoin buyer since the launch of Bitcoin ETFs, most Bitcoin investors are confident that its value will continue to rise significantly in the future.
How to Invest in Bitcoin: Here are the Steps!
Now that you understand why so many people are investing in Bitcoin, let’s go over the steps to get started with your own investment.
Step 1: Where to store your Bitcoin and what is self-custody?
The first step to buying Bitcoin is to set up a Bitcoin wallet.
A Bitcoin wallet allows you to hold your Bitcoin investment. Think of your wallet as your bank account for Bitcoin. It lets you store, send, and receive Bitcoin.
Self-custody of your Bitcoin means you become your own bank and have full responsibility for managing and securing your Bitcoin.
When setting up your wallet, you'll create a password and record wallet recovery information (private keys) to ensure you don’t lose access to your Bitcoin if your device is lost or you forget your wallet password.
Never share your password or private keys with anyone, as no legitimate platform will ask for them. Only if you wish to have your Bitcoin passed on to someone close to you, should you let someone know the keys to your Bitcoin. Bitcoin transactions are irreversible, so if someone knows the keys to your wallet, they can empty it in seconds, with no way to recover the Bitcoin.
When choosing a Bitcoin wallet, look out for key features, including:
Security: Use Bitcoin-only wallets that are open source.
Ease of use: The wallet should have a user-friendly interface that makes it simple to send, receive, and manage your Bitcoin.
Self-custody: Make sure you own and control your wallet’s private keys so you have complete ownership over your Bitcoin.
Wallet recovery options: Choose wallets that offer easy backup solutions so you don’t lose access to your Bitcoin if your device is lost or your password is forgotten.
Software Wallet:
Muun Wallet is a free, secure and easy-to-use Bitcoin wallet, perfect for beginners. Click here to get started with the Muun Wallet mobile app.
Hardware Wallet:
Bitbox02 is a great choice for securely holding large amounts of Bitcoin long term. Click here to set up your Bitbox02.
Advanced & Multisig Wallet:
SeedSigner is a more advanced setup that allows you to have total control and use multisig setups. Click here to get set up with SeedSigner.
Need professional assistance? Book an appointment with our expert self-custody advisor here.
Step 2: Choose a Bitcoin Exchange
Once you've set up your Bitcoin wallet, it’s time to find a reputable Bitcoin exchange that allows you to buy and sell Bitcoin (BTC) using dollars (AUD).
There are two kinds of Bitcoin exchanges:
1. Custodial Exchanges: Custodial exchanges hold your Bitcoin and private keys, meaning you rely on their security to protect your Bitcoin. This is risky because if the exchange is hacked or goes bankrupt, you could lose your Bitcoin.
2. Non-Custodial Exchanges: Non-Custodial exchanges, also known as self-custody exchanges, allow you to maintain full control and ownership over your Bitcoin and private keys. This is the most secure option.
paybtc is Australia’s only self-custody Bitcoin exchange that allows you to seamlessly buy and sell Bitcoin. All you need is your bank account and Bitcoin wallet.
Once you've set up your Bitcoin wallet, click here for How to Buy Bitcoin using paybtc.