Crypto Crash Course for Aussies
So it seems there are a lot of people lately who want to jump on the crypto bandwagon, strap on their moon boots and ride a rocket to Lambo Land, a wonderful place where everyone has a Lamborghini (preferably with a licence plate that says HODL).
Now, if you come from a land down under, this might not be as quite as simple as you hoped.
But never fear, it's only a small learning curve, I'll lay out a few of your options and let you know the pros and cons.
Where do I start?
There is a good chance you stumbled across cryptocurrency because you heard about Bitcoin. So let's start there! I'm not going to go into the intricate details about what Bitcoin actually is, or whether you should buy Ethereum instead, or which selection of altcoins are the best. That is entirely up to you, I just want to show you how to convert AUD into crypto!
Exchanges
An exchange is a marketplace for cryptocurrency, you can trade your fiat currency (dollar dollar bills y'all) for a variety of different crypto coins. The price of the coins fluctuates (just like the stock market) and that's how people are making money trading them.
There are a so many exchanges to choose from, but a few of the more popular ones are (in alphabetical order) -
Binance
Bitfinex
Bittrex
BTCMarkets
Coinbase
CoinJar
CoinSpot
HitBTC
Independent Reserve
Kraken
Poloniex
Unfortunately for Aussies, not all of these exchanges will accept AUD. Here are the main exchanges that are AUD friendly:
BTCMarkets
Coinbase
CoinJar
CoinSpot
Independent Reserve
LocalBitcoins - not exactly an "exchange" but it can connect you to buyers and sellers
The prices on these exchanges can vary quite a bit, and it is generally accepted that Aussies get the short end of the stick when it comes to the initial purchasing of crypto. But once you have that initial amount and you start trading it's not such a big deal, and if and when you decide to cash out, if you use the same exchange then it's all relative (you may have paid a higher than average price to begin with, but you will also be selling for that same higher than average price).
Fees!
The thing you need to be wary of is fees! They can be sneaky little buggers, and different exchanges charge different amounts for deposits, transfers and trading. I'll try to make it simple for you, if you would like more detailed information about fee structure click on the link in each heading.
BTC Markets - Fee Structure
Deposit AUD from a bank account (POLi Payment) - $3.30 flat fee
Withdrawing AUD to bank account - FREE
Trading AUD pairs (AUD/BTC, AUD/ETH etc) - 0.85% trading fee (slowly decreases)
Trading coin pairs (LTC/BTC, ETH/BTC etc) - 0.22% trading fee
Coinbase - Fee Structure
Credit/Debit Card Buys - 3.99% fee
Coinbase does not allow you to convert coins back into AUD, it is for buying only.
CoinJar - Fee Structure
Deposit AUD from a bank account (BPay) - FREE*
Withdraw AUD to bank account - 1% fee
CoinSpot - Fee Structure
Deposit AUD from bank account (POLi Payment) - FREE
Deposit AUD from bank account (BPay) - 2% fee
Withdrawing AUD to bank account - FREE
Trading AUD pairs - between 2% and 3% trading fee depending on the coins
Trading coin pairs - 1% trading fee
Independent Reserve - Fee Structure
Deposit AUD from bank account (POLi Payment) - $3.30 flat fee
Withdraw AUD to bank account - FREE
Trade Commission - starts at 0.5% (slowly decreases)
LocalBitcoins - Fee Structure
Registering, buying, and selling Bitcoin - FREE
If you make advertisements you are charged a 1% fee for every completed trade
So which one do I use?
That is up to you, each exchange has it's own pros and cons.
I think BTC Markets is good because it uses a flat fee for deposits instead of charging a percentage. For example, if you deposit $2000 on BTCMarkets it will cost you $3.30 but if you spend $2000 on Coinbase then $79.80 will be taken in fees. BTCMarkets also allows you to set orders at specific prices, where Coinbase and CoinSpot are more like brokers, you take the price they set.
CoinSpot has FREE deposit which is excellent but then you are looking at 2% to 3% on each trade you make between AUD and crypto. CoinSpot has a lot more coins than BTCMarkets or Coinbase, so if you are looking to buy a couple of particular altcoins and hold them long term then this may be the site for you.
LocalBitcoins is cheap, but there is always a risk when buying from strangers. Majority of these trades are done by depositing money into their bank account, so you want to make sure they have a high rating or you meet them in person and exchange for cash.
You will also notice the price of coins can vary quite a bit between exchanges, so you should carefully read the fee structures and compare the coin prices between each exchange (or "broker") and decide what you think is the most cost effective.
I'm here to trade!
In that case I would recommend you just purchase one coin from an AUD compatible exchange (Bitcoin and Ethereum are good options) then transfer it to a much larger exchange. My personal favourite is Bittrex because it has a lot of people (volume) and a huge range of coins. However I have listed several others above, and in time you may come to use them all for different reasons.
Regardless, you will need to set up an account on one of those exchanges, find the address for the wallet that corresponds with the coin you have purchased and transfer it over. (For example if you bought Bitcoin from CoinSpot and you want to send it to Bittrex you would go to your Bittrex wallets, locate the Bitcoin wallet and copy the address.)
From there you can start trading a range of different altcoins, but that is a much larger topic and you'll find plenty of information on that elsewhere, I'm trying to keep this as informative and basic as possible!
Good Luck!
Well that's the basics covered, hopefully it was of some help to you! This is my first "story" in steemit, I was curious to see how it all worked and thought this was a helpful topic to cover. If you found it useful I would appreciate you liking or upping this post below (I think I might actually earn money from this post if it becomes popular?). If I get some positive feedback I might write some more basic articles for you guys. I've got a nice, simple analogy in mind to explain wallets!
If you would like to donate (Don't worry I don't expect anything from you! But it can't hurt to put it out there, right?) here are my Bitcoin and Ethereum addresses:
BTC - 15GDfQY6Xy6uxbVtpSu41krzy1vpZRUxLX
ETH - 0x720655eea5706724fb99e2c79976b09af31d8219
Great compile. Thanks mate
Cheers mate, I appreciate it. Just trying to do my part to make crypto mainstream!
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Hi @mrstuffnthings. We have a pretty strong Team Australia community going here on steemit to support each other. If you'd like to be part of it, then please check out this link for the instructions on how to join: https://steemit.com/teamaustralia/@choogirl/team-australia-new-recruits-update-03-09-17-plus-team-australia-milestone-200-members
Thanks @choogirl I'll check it out!