Frequently Asked Questions

Bitcoin is the world's first decentralized digital currency, created in 2009 by the pseudonymous Satoshi Nakamoto. It operates on a peer-to-peer network without the need for banks or central authorities.

Key features include:

• Decentralized: No single entity controls it
• Limited Supply: Only 21 million Bitcoin will ever exist
• Transparent: All transactions are recorded on a public ledger (blockchain)
• Secure: Protected by advanced cryptography
• Borderless: Send and receive globally without intermediaries

Yes, Bitcoin is completely legal in Australia. The Australian government recognizes cryptocurrencies as legal property and has established clear regulations for their use.

In Australia:

• Bitcoin is treated as property for tax purposes
• Exchanges must be registered with AUSTRAC
• Consumer protections apply to cryptocurrency purchases
• You can legally buy, sell, hold, and use Bitcoin
• Approximately 32% of Australians already own cryptocurrency

You don't need to buy a whole Bitcoin. You can start with as little as $10-$50 AUD. Bitcoin is divisible to 8 decimal places, with the smallest unit being 1 satoshi (0.00000001 BTC).

We recommend:

• Beginners: Start with $50-$200 to learn without significant risk
• Conservative approach: Only invest what you can afford to lose
• Dollar-Cost Averaging (DCA): Buy small amounts regularly (e.g., $50/week) to smooth out price volatility
• Long-term perspective: Most successful Bitcoin investors hold for years, not days

This is not financial advice. Always do your own research and consider your personal financial situation.

We recommend Gemini for Australian Bitcoin buyers. It's a trusted, regulated exchange with excellent security and low fees.

Why Gemini?

• Licensed and regulated globally
• Industry-leading security (SOC 2 certified)
• Low fees with Active Trader mode (0.2%)
• User-friendly interface for beginners
• Accepts Australian bank transfers (via PayID)
• Free withdrawals to your own wallet

Sign Up to Gemini

There are several options for storing Bitcoin, each with different security and convenience tradeoffs:

• Exchange Wallets (Beginner):

  Keep Bitcoin on Gemini or other exchanges. Convenient but you don't control the private keys. Good for small amounts while learning.

• Mobile Wallets (Intermediate):

  Apps like BlueWallet or Muun. You control your keys. Good for daily spending amounts.

• Hardware Wallets (Recommended for larger amounts):

  Physical devices like Ledger or Trezor. Maximum security for long-term storage. Keeps your private keys offline.

Golden Rule: "Not your keys, not your coins." For significant amounts, always move your Bitcoin to a wallet where you control the private keys.

A seed phrase (also called a recovery phrase or backup phrase) is a list of 12-24 words that serves as a master backup for your Bitcoin wallet. It's the most critical piece of information for securing your Bitcoin.

Critical seed phrase rules:

• Write it down: Never store it digitally (no photos, cloud storage, or emails)
• Keep it safe: Store in a secure physical location (fireproof safe)
• Never share it: No legitimate service will ever ask for your seed phrase
• Multiple backups: Keep copies in separate secure locations
• Anyone with your seed phrase can access your Bitcoin

Warning: If you lose your seed phrase and your device fails, your Bitcoin is lost forever. No one can recover it for you.

The Bitcoin network itself has never been hacked. It's secured by the most powerful computing network in the world and has operated continuously since 2009 without compromise.

However, individual users can be compromised through:

• Phishing attacks and fake websites
• Malware on your computer or phone
• Exchange hacks (if you store Bitcoin on an exchange)
• Social engineering scams
• Poor security practices (weak passwords, reused passwords)

Stay safe by:

• Using hardware wallets for large amounts
• Enabling two-factor authentication (2FA)
• Never sharing your seed phrase or private keys
• Double-checking addresses before sending
• Using reputable, licensed exchanges like Gemini

Gemini offers two trading interfaces with different fee structures:

Additional benefits: 10 free withdrawals per month to your own wallet.

Dollar-Cost Averaging (DCA) is an investment strategy where you invest a fixed amount of money at regular intervals, regardless of the price. This is one of the most recommended strategies for Bitcoin beginners.

How it works:

• Choose a fixed amount (e.g., $50, $100, $500)
• Choose a regular interval (weekly, fortnightly, monthly)
• Automatically or manually purchase that amount on schedule
• Continue regardless of whether price is up or down

Benefits:

• Removes emotion: No trying to "time the market"
• Averages out volatility: You buy more when price is low, less when high
• Builds discipline: Creates a consistent investment habit
• Reduces stress: No worrying about buying at the "perfect" time

Example: Investing $100/week for a year means you'll accumulate Bitcoin regardless of price swings, and historically this has outperformed trying to time the market.

In Australia, Bitcoin is treated as property, not currency, for tax purposes. This means Capital Gains Tax (CGT) applies when you dispose of Bitcoin.

Key tax points:

• Taxable events: Selling Bitcoin for AUD, trading Bitcoin for other crypto, using Bitcoin to purchase goods/services
• Not taxable: Simply buying and holding Bitcoin
• CGT discount: If you hold for more than 12 months, you get a 50% CGT discount
• Personal use exemption: If you use Bitcoin to buy something under $10,000 for personal use, it may be exempt
• Calculate gains: Sale price minus purchase price (cost basis)

This is general information only. Consult a tax professional or accountant familiar with cryptocurrency for personalized advice.

Yes, the Australian Taxation Office (ATO) actively monitors cryptocurrency transactions. They have stated that cryptocurrency is a key focus area.

How the ATO tracks crypto:

• Data-sharing agreements with Australian cryptocurrency exchanges
• Blockchain analysis tools to track transactions
• Data matching programs with banks and financial institutions
• International information sharing with other tax authorities

Important: Always report your cryptocurrency transactions accurately on your tax return. Penalties for non-compliance can be severe.

The ATO has explicitly warned cryptocurrency holders that they are monitoring transactions and have systems in place to detect non-compliance.

The ATO requires you to keep records of all cryptocurrency transactions for at least 5 years. Good record-keeping makes tax time much easier.

Records to maintain:

• Date of each transaction
• Amount in AUD at the time of transaction
• Purpose of the transaction
• The other party's details (if known)
• Exchange records and receipts
• Wallet addresses used
• Software costs or hardware wallet purchases

Pro tip:

• Most exchanges provide transaction history exports (CSV files)
• Consider using crypto tax software like Koinly or CoinTracking
• Keep screenshots and confirmations of all transactions
• Maintain records even if transactions are below taxable thresholds

The blockchain is Bitcoin's public ledger - a continuously growing list of records (blocks) that are linked and secured using cryptography. Think of it as a digital record book that everyone can see but no one can cheat.

Key characteristics:

• Distributed: Thousands of computers worldwide maintain identical copies
• Immutable: Once recorded, transactions cannot be altered or deleted
• Transparent: Anyone can view all transactions ever made
• Secure: Cryptography ensures data integrity and authenticity
• Consensus-based: All participants must agree on the state of the ledger

Each block contains:

• A batch of recent transactions
• A timestamp
• A cryptographic link to the previous block

This is why it's called a "blockchain" - each block is chained to the one before it, creating an unbreakable historical record.

Bitcoin transaction times vary based on network congestion and the fee you pay:

Factors affecting speed:

• Transaction fee: Higher fees = faster processing
• Network congestion: More activity = slower confirmations
• Time of day: Network activity varies globally

Note: For instant payments, some wallets support the Lightning Network, which enables near-instant Bitcoin transactions with minimal fees.

The Bitcoin halving is a pre-programmed event that occurs approximately every 4 years (every 210,000 blocks). During a halving, the reward that miners receive for processing transactions is cut in half.

Why it matters:

• Controls supply: Reduces the rate of new Bitcoin creation
• Creates scarcity: Makes Bitcoin increasingly scarce over time
• Predictable: Everyone knows exactly when halvings will occur
• Final supply: Ensures only 21 million Bitcoin will ever exist

Halving history:

• 2009: 50 BTC per block (initial)
• 2012: 25 BTC per block (1st halving)
• 2016: 12.5 BTC per block (2nd halving)
• 2020: 6.25 BTC per block (3rd halving)
• 2024: 3.125 BTC per block (4th halving)
• Next halving: ~2028

Historically, Bitcoin's price has increased significantly in the 12-18 months following each halving event, though past performance doesn't guarantee future results.

Bitcoin has value for many of the same reasons traditional money has value, plus additional unique properties:

Traditional monetary properties:

• Scarcity: Only 21 million will ever exist (unlike fiat currency which can be printed infinitely)
• Divisibility: Can be divided into 100 million satoshis
• Durability: Digital, cannot degrade or be destroyed
• Portability: Can send any amount anywhere instantly
• Fungibility: Each Bitcoin is identical to any other

Unique Bitcoin properties:

• Decentralized: No government or bank can control it
• Censorship-resistant: No one can stop transactions
• Transparent yet private: All transactions visible but users pseudonymous
• Programmable: Can be used in smart contracts and applications
• Network effect: Growing global acceptance and adoption

Ultimately, Bitcoin has value because people believe it has value - the same reason gold, art, or any currency has value. The difference is Bitcoin has properties that make it uniquely suited for the digital age.

Bitcoin reached its all-time high (ATH) of $126,210 USD in October 2025. As of December 2025, Bitcoin is trading around $93,000 USD.

Historical price milestones:

• 2010: $0.08 (first recorded price)
• 2013: First $1,000 breakthrough
• 2017: $19,783 (previous cycle high)
• 2020: $29,000 (institutional adoption begins)
• 2021: $69,000 (previous ATH before current cycle)
• 2024: ETF approval drives new bull market
• 2025: $126,210 ATH in October

Important: Bitcoin is highly volatile. Prices can rise or fall dramatically. Never invest more than you can afford to lose, and always take a long-term perspective.

Historical performance is not a guarantee of future results. Bitcoin has experienced multiple boom and bust cycles throughout its history.

This is one of the most common questions, and the answer depends on your perspective and timeframe.

Reasons people believe it's NOT too late:

• Early adoption: Only ~32% of Australians and less than 5% globally own Bitcoin
• Institutional adoption: Major companies, banks, and countries are just beginning to adopt
• Limited supply: 21 million cap means scarcity increases as demand grows
• Long-term view: If Bitcoin becomes global reserve asset, current prices could be early
• Improving infrastructure: ETFs, regulation, and easier access are just emerging

Important considerations:

• Bitcoin is volatile - expect significant price swings
• Think in years, not days or months
• Use Dollar-Cost Averaging to smooth out volatility
• Only invest what you can afford to hold through downturns
• Past performance doesn't guarantee future results

Bottom line: The "best time" to buy Bitcoin was when you first learned about it. The second best time is now - if you understand the risks, have a long-term perspective, and only invest what you can afford.

Bitcoin's irreversible nature makes it attractive to scammers. Protect yourself by recognizing common red flags:

Warning signs of scams:

• Guaranteed returns: No investment can guarantee profits
• Pressure to act fast: Scammers create artificial urgency
• Requests for seed phrases/private keys: NEVER share these with anyone
• "Send Bitcoin to receive more": Always a scam, no exceptions
• Celebrity endorsements: Often fake or impersonators
• Unsolicited investment opportunities: If it sounds too good to be true, it is
• Recovery services: "We can recover your lost Bitcoin" - usually scams

Stay safe by:

• Only using regulated exchanges like Gemini
• Double-checking website URLs (look for https and correct spelling)
• Never sharing your seed phrase or private keys
• Being skeptical of unsolicited messages
• Verifying sources independently
• Starting with small amounts until comfortable

Remember: If someone asks for your seed phrase, private keys, or wants you to send Bitcoin to get more back, it's 100% a scam. No exceptions.

Unfortunately, if you send Bitcoin to the wrong address, the transaction cannot be reversed. This is one of the fundamental properties of Bitcoin - transactions are final and irreversible.

What happens:

• If the address doesn't exist: Funds are likely lost forever
• If the address belongs to someone else: Only they can return the funds (unlikely with strangers)
• If you sent to an exchange's address: Contact their support immediately, they may help
• There is no "Bitcoin customer service" to call for help

Prevention is critical:

• Always double-check addresses: Verify the first and last 4-6 characters
• Use copy-paste: Never type addresses manually
• Send a test transaction: For large amounts, send a small test first
• Use QR codes: Reduces risk of errors
• Save trusted addresses: Use address books in your wallet
• Beware of malware: Some malware changes copied addresses

Pro tip: When sending large amounts, always send a small test transaction first to verify the address is correct before sending the full amount.

The Bitmas Party is our annual Bitcoin celebration event, bringing together the Australian Bitcoin community for learning, networking, and festive fun!

Event highlights:

• Educational talks from Bitcoin experts
• Networking with fellow Bitcoiners
• Live demonstrations of Bitcoin technology
• Q&A sessions for beginners
• Food, drinks, and festive atmosphere
• Prize giveaways and Bitcoin raffles

Whether you're brand new to Bitcoin or a seasoned hodler, Bitmas is the perfect opportunity to connect with the community and deepen your understanding.

Learn More About Bitmas 2025

Yes! We offer free Bitcoin onboarding sessions to help Australians get started safely and confidently with Bitcoin.

Upcoming sessions in December 2025:

What we cover:

• Setting up your first Bitcoin wallet
• Buying your first Bitcoin on Gemini
• Security best practices and seed phrase management
• Understanding fees and transactions
• Australian tax considerations
• Avoiding common scams and mistakes
• One-on-one assistance with your questions

Sessions are small-group format with personalized attention. Bring your laptop or smartphone and we'll walk you through everything step-by-step.

To register or learn more:
Email us at hello@bitcoinadvantage.com

Space is limited to ensure quality instruction. Reserve your spot early!