As a large, advanced, and prosperous nation with a well-educated population, Australia is Oceania’s natural cryptocurrency leader. Austrlians also tend to be early adopters of new technology, which has certainly boosted Bitcoin in Australia. While a strong Bitcoin industry and community has developed in Australia, the situation might be even further advanced if the government hadn’t passed some rather draconian taxation laws in the past.
Thankfully, the Australian government has since relaxed these strictures. Bitcoin is thriving in the country as a result, as shown by a survey conducted in December of 2020 which found that nearly 90 of Australians had heard of Bitcoin. It was also revealed that nearly 20% of young adults in Austrlia own some form of crypto. Chainalysis currently ranks Australia as 20th in the world for crypto adoption.
If you live in Australia, this guide will get you up to speed on Bitcoin’s status in your country, briefly covering Bitcoin’s history there and describing the current state of play. If you’re looking to get started with buying some BTC, this guide will also explain how to do so, using either a bank transfer or any credit or debit card issued by VISA or MasterCard.
Double Taxation Woes
In mid-September of 2017, the Australian government amended its unfortunate legislation which applied GST to Bitcoin on both purchase and payment. Previously, clients of Coinmama and all other crypto brokers or exchanges were forced to pay GST on any Bitcoin they purchased. Thereafter, clients were expected to pay GST a second time if they spent their purchased BTC on goods or services. This demonstrated the Australian government’s willingness to engage constructively with the fintech industry, with the goal of promoting innovation and creating employment.
Australian Tax Regulations
Although double taxation has ended, the Australian Taxation Office is by no means turning a blind eye to cryptocurrency. The ATO has issued clear and extensive guidelines on how crypto will be treated for tax purposes; essentially you become liable for capital gains tax when you sell or transact.
Clearly, the ATO researched crypto in depth before creating these rules, as even technically-complex eventualities, such as chainsplits, are addressed. We at Coinmama would advise our clients to familiarize themselves with these guidelines, as the ATO has warned that they intend to crack down on crypto tax dodgers. The good news is that crypto losses are considered deductible.
The Outlook for Bitcoin in Australia
Despite the ATO’s somewhat heavy-handed approach, there’s cause for optimism in the Australian cryptocurrency environment. A slew of complaints from over 1,200 people regarding crypto scams led to Australia’s financial intelligence agency to formulate regulation to govern crypto exchanges. Australia regulators have also committed to taking action against deceptive ICOs (Initial Coin Offerings). In September of 2020, the Australian Securities and Investments Commission banned an Australian promoter of the BitConnect Ponzi scam from offering financial services.
Such official regulatory measures will hopefully reduce the incidence of fraud, but it’s also important that cryptocurrency users educate themselves and take responsibility for their own crypto finances to better avoid such pitfalls. As in the BitConnect example above, regulators often react long after the damage has been done. Provided you use a properly regulated exchange like Coinmama, you’ll be able to buy your bitcoins safely.
The Australian government is also experimenting with various blockchain applications, from tourism to tracking and trading agricultural commodities. In July of 2018, the government also signed a major $740 million deal with IBM to implement blockchain technology to improve data security across multiple agencies. This project should prevent any repeat of the problems experienced during Australia’s last national census.
In Feburary of 2020, the Australian government unveiled its National Blockchain Roadmap, which lays out how it intends to use blockchain technology to improve efficiency across various economic sectors, such as agriculture, finance, and education. Since then, two blockchain projects aimed at decreasing business compliance cost have received nearly $5 million in government funding, and further blockchain tech for such diverse applications as assisting public servants and tracking mango shipments has been tested. The government’s research shows that blockchain technology could contribute significantly to the economy.
As for issuing its own cryptocurrency, an option which several nations are exploring, the Reserve Bank of Australia has denied consideration of any such plans. Indeed, a senior official at the RBA stated that he sees little prospect of widespread cryptocurrency adoption within the nation. This is in keeping with the history of statements from central banks around the world, who were all naturally incentivized to downplay the monetary potential of Bitcoin ever since it began to gain significant value.
How to Buy Bitcoin in Australia
Coinmama allows Australians to buy bitcoin with a debit or credit card issued by either VISA or MasterCard. If you’re looking to buy bitcoin with a bank transfer or your credit or debit card, then Coinmama facilitates this in a few simple steps:
Step 1 – Create Your Coinmama Account
1. Head to the main corporate header menu and select the light blue “Sign Up” tab at the top right (or click here). Note: if you already have an account, just sign in via the “Log In” button with your existing login details (or click here).
2. Enter your email, password, first name, last name and your country of residence.
3. Look for an email from Coinmama asking you to confirm your account. Click the link in the email to complete the registration process.
** Note: for more information on how to create an account with us, click here.
Step 2 – Get Verified for Purchase
1. To purchase bitcoin (BTC), you first need to become verified.
2. It’s necessary to enter your personal information and upload your ID or passport, plus various other documents depending on which level of verification you wish to reach.
Our verification team works 6:00-23:00 UTC. If everything looks ok, you should be verified in about fifteen minutes during working hours, or as soon as we’re back at our desks. If we have a question about your documents or need more information, we’ll let you know. Once your account is verified, you’re ready to buy Bitcoin!
**Note: for further help with account verification, please click here.
Step 3 – Place your first order
1. Once signed in and verified, click the “Buy” button and select “Bitcoin”.
2. Next, choose the amount you would like to buy. You can select a package, or enter the fiat amount or crypto quantity you’d like to buy of up to roughly $5,000 (as of the time of writing) for card purchases or $15,000 for wire transfer purchases.
3. Supply your Bitcoin wallet address. If you’re unsure what this is, please check out this article. The address you enter is where we’ll send the coins which you buy. You can re-use this address for subsequent purchases or get a new one from your wallet, at your discretion.
4. Then, select the “Go to Payment” button.
Step 4 – Complete your Checkout
1. Select your payment method. Users worldwide can choose to buy bitcoin with a credit card, debit card, bank transfer and now Apple Pay.
2. Enter your payment details and click the “Buy” button.
Note: For card purchases, kindly note that only cards issued by VISA or MasterCard are accepted. As for wire transfers, they usually take 1-2 business days to post. This means that when paying via wire transfer, you will get the rate at the time your money arrives at our account. This means that during times of high price volatility, you may get a rather different Bitcoin amount (either more or less) than expected.
Once payment has been made, our BTC transaction to your wallet’s address then needs to be confirmed by the Bitcoin network. In approximately 10 minutes, a Bitcoin payment will be broadcast from Coinmama’s wallet to the Bitcoin address you supplied in Step 3, point 3.
Note that during times of especially high traffic, your transaction may take longer than normal to appear as confirmed within your wallet. Ordinarily, the transaction will be confirmed within 10 minutes. For large amounts, this might take a little longer (up to an hour).
Bitcoin and blockchain technology has a bright future in Australia, as in most other countries. It’s perfectly legal to purchase in Australia and there are many opportunities to use it within the country. For example, you can pay all sorts of Australian bills via the Living Room of Satoshi website. However, it’s also important to be mindful in your Bitcoin dealings, lest you run afoul of the taxman.