Crypto trading

Crypto trading in Australia

Australians are crypto enthusiasts. A survey showed that nearly 18% of Australia’s population own cryptocurrencies, and 86% of crypto owners are male, under 35 years. Australians love to invest in crypto because of the decentralised nature of crypto trading. They get the ability to own and store their assets without the interference of a third party. Another reason to love crypto is its reliability. Most people in Australia buy cryptocurrency through an Australian crypto exchange. Some popular cryptocurrencies in Australia are Bitcoin, Dogecoin and Ethereum. The Australian government is keen on regulating the crypto market to build trust between the crypto investors and the exchange.

Types of cryptocurrency exchanges

Centralised exchanges

Centralised cryptocurrency exchanges are online platforms through which investors buy and sell cryptocurrencies. Here, a third party or middle man helps to conduct transactions. Crypto buyers and sellers trust the middle man to handle their assets. Investors approach these exchanges to complete the transactions safely and find trading partners.

Cryptocurrencies are stored in digital wallets. If investors forget the key to the wallet, they will lose their digital currency holdings. It can be avoided when people make transactions through centralised exchanges because it safeguards the assets for the investors.

Decentralised exchanges

Decentralised cryptocurrency exchanges are platforms where traders make crypto transactions without the help of an intermediary like a third party or middleman. The transactions are conducted through self-executing agreements called smart contracts. Decentralised exchanges authorise trading within a specific exchange and allow peer-to-peer trading of cryptocurrencies, and the buyers and sellers keep control of their wallet keys. 

This exchange is ideal for investors who want to cherish their privacy. Traders must safeguard their funds and are responsible if they make mistakes and lose their private keys or send funds to the wrong address by mistake.

Hybrid cryptocurrency exchanges

Hybrid cryptocurrency exchanges are platforms that have mixed features of centralised and decentralised exchanges. The transactions are done at high speed like those done through centralised exchanges, and the traders can control their private keys as in decentralised exchanges. In short, hybrid exchanges provide the functionality and liquidity of centralised exchanges and the safety and privacy of decentralised exchanges.

Investors’ funds are stored in digital wallets and not in hot wallets. The digital wallet is cold storage and is not connected to the internet. It provides high security and prevents cyber attacks.

Features to look for in a crypto exchange

Accessibility: One of the most significant factors to look for in a crypto exchange is its accessibility. Investors must choose crypto exchanges permitted in their area, city, state, or country.

Security:  Crypto markets are volatile and unsteady. Buyers and sellers are vulnerable to hacking and cyber-attacks. Investors must choose exchanges that offer security, insurance, and cold storage facility to store their coins.

Liquidity: Liquidity is the ease by which the crypto coins are converted into other coins or cash. Low liquidity indicates that the market is volatile, and high liquidity means stable markets with few fluctuations in price.

Fees: Crypto exchanges collect fees from investors for processing transactions and storing the crypto coins safely. Most exchanges follow the ‘maker-taker’ fee model. 

An Australian crypto exchange caters to the needs of crypto investors in Australia. The Australian Securities and Investment Commission regulates the crypto exchanges. Cryptocurrencies are used in Australia to buy and sell goods online. Coins are also stored for investment purposes, and they grow in value.

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