Looking into decentralised currencies? Check this out first
While share trading remains a popular option, a growing number of investors are turning to Bitcon and other cryptocurrencies, and younger generations are leading the charge.
There’s also a lot of fuss over Bitcoin and other “decentralised” currencies. So should this even enter into your trading plan?
Start at the top: Regular share trading versus trendy crypto investments apps
To understand crypto - and what decentralised finance is - first you need to know a little bit about how traditional finance works.
Typically in traditional finance (or centralised finance) your money is kept, managed and used by banks. They act as the third parties who facilitate the movement of money between people, businesses and corporations.
For example, let’s say you bought a coffee at your local cafe: when you use your credit card, that charge goes from the merchant (the cafe) to the bank they use, which forwards the card details to the credit card network.
The network approves the charge and requests a payment from your personal bank. Finally, your bank approves and sends the money to the cafe’s bank account.
Usually, merchants pay for your ability to use the card, which is why you are sometimes charged a surcharge. That surcharge is a fee that comes for using banks - aka traditional finance institutions.
DeFi is actually quite complex and in order to participate in DeFi applications you still need to be a bit tech-savvy
Decentralised finance (DeFi) turns this picture on its head by removing banks (and associated fees from the picture.
Your money is held in a digital wallet rather than a traditional bank account, and you’ll be able to lend, trade and borrow from anywhere in the world so long as you have access to the internet. The currency used in this sort of space is crypto which isn’t like the money that sits on your bank account.
More on Defi, crypto and blockchain
Just try to remember that DeFi is a digital financial service that uses blockchain technology and cryptocurrencies rather than the financial institutions you might be familiar with. There is also a lot of volatility and risks to be mindful about when entering the market.
Crypto expert and co-founder of crypto investment platform Block Earner—which aims to make decentralised finance more user friendly—Charlie Karaboga says, “DeFi is actually quite complex and in order to participate in DeFi applications you still need to be a bit tech-savvy.”
Don’t worry if that world confuses you - if you just consider that there is a community of people operating in a decentralised market, that’s a good start.
According to the Organisation of Economic Cooperation and Development OECD), the DeFi market offers people financial services without the need for intermediaries or centralised processes.
“Rather than relying on centralised parties for trust, DeFi markets are community-based networks seeking ways to automate the factors that contribute to trust in centralised institutions, and operating in a global, borderless way,” says the OECD.
Where should I begin? How do I get crypto?
Let’s just take Bitcoin as an example. It’s a type of digital currency known as cryptocurrency, which operates outside traditional banking systems. In short, it’s a medium of exchange in a digital environment. Unlike fiat currency - any national currency that isn’t determined by the value of a commodity - Bitcoin is created, distributed, traded, and stored with the use of a decentralised ledger system, known as a blockchain.
Great, so what’s the blockchain, again? The blockchain is a type of shared database that stores information in blocks. In the case of Bitcoin, and similar cryptocurrencies, the blockchain is used in a “decentralised” way, where no single person or group has control but rather the control is shared.
Related: More crypto hype lately but does that mean you should invest?
So you can buy Bitcoin, but you won’t do it through your traditional bank, as we’ve touched on. Rather, you’ll need to use a crypto trading platform, exchanging your actual “fiat” dollars for cryptocurrency - or Bitcoins specifically, as the case may be.
What’s next?
Research!
There are many different types of cryptocurrencies out there, which is why it is important to do thorough research before you invest. The last thing you want is to fall victim to an investment scam.
Also be mindful that the crypto space is a very volatile market with many risks, so try to do as much research as possible before investing.
It is always best practice to understand what you’re investing in first, and this can be applied to both traditional share trading and crypto. With so many different types of trading platforms available, make sure to find the one that works best for you.
If you want to try regular everyday share trading first, consider checking out some of the best share trading platforms in Australia as named in our Mozo Expert Choice Awards^. Otherwise, you can start comparing below a range of accounts to find one that best suits the share trading you want to do.
Share account comparisons on Mozo
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Share Investing
Standard
Small trade brokerage
Monthly fee
$0.00$0.00CMC Markets Invest makes it easy to trade with a handy web and mobile platform, competitive pricing and thousands of securities. Buy Australian and US shares from $0 brokerage (T&Cs apply - see website for full details).
Share Investing
CMC Markets Invest makes it easy to trade with a handy web and mobile platform, competitive pricing and thousands of securities. Buy Australian and US shares from $0 brokerage (T&Cs apply - see website for full details).
- Monthly fee
- $0.00
- Monthly fee waiver
- -
- Special offers
- -
- Brokerage details
- $0 for trades up to $1,000. Greater of $11 and 0.1% for trades over $1,000.
- Settle from any bank account
- Settlement account offered
- ANZ Cash Account
- CHESS ownership available
- Share pack
- Independent broker reports
- International markets
- Options
- Warrants
- IPOs
- Live data
- Market depth data
- Real time charting
- Other restrictions
- -
Read our Mozo Review to learn more about the Share Investing
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Share Trading
Small trade brokerage
Monthly fee
$3.00$0.00Trade more than 22,000 shares, ETFs and options across the Australian, US and Hong Kong markets on the moomoo Australia platform. And only pay from A$3 for local CHESS-sponsored trades and US$0.99 for all US trades. Other fees apply. Earn up to 6.8% p.a. introductory rate for 30 days, applicable to up to AU$80,000 on uninvested cash, and get 10 free stocks with eligible deposits (T&Cs apply)
Share Trading
Trade more than 22,000 shares, ETFs and options across the Australian, US and Hong Kong markets on the moomoo Australia platform. And only pay from A$3 for local CHESS-sponsored trades and US$0.99 for all US trades. Other fees apply. Earn up to 6.8% p.a. introductory rate for 30 days, applicable to up to AU$80,000 on uninvested cash, and get 10 free stocks with eligible deposits (T&Cs apply)
- Monthly fee
- $0.00
- Monthly fee waiver
- -
- Special offers
- Ongoing free access to real-time US market data.
- Brokerage details
- ASX trades are 0.03% the transaction amount, minimum $3.00 per order. US trades from $0.99 USD, other fees apply.
- Settle from any bank account
- Settlement account offered
- Customer funds held in segregated trust accounts with HSBC.
- CHESS ownership available
- Share pack
- Independent broker reports
- International markets
- Options
- Warrants
- IPOs
- Live data
- Market depth data
- Real time charting
- Other restrictions
- Additional regulatory pass-through fees apply for US trades. Options are available for US markets only.
Read our Mozo Review to learn more about the Share Trading
Share Trading
Small trade brokerage
Monthly fee
$7.70$0.00Buy and sell with a low $7.70 flat fee per trade and access to all ASX Shares and ETFs to invest in with GO Markets. Enjoy dedicated local customer support, a regulated Australian company for trading ASX Shares and ETFs. Plus, enjoy $0 Brokerage on your next 15 trades! (T&Cs apply).
Share Trading
Buy and sell with a low $7.70 flat fee per trade and access to all ASX Shares and ETFs to invest in with GO Markets. Enjoy dedicated local customer support, a regulated Australian company for trading ASX Shares and ETFs. Plus, enjoy $0 Brokerage on your next 15 trades! (T&Cs apply).
- Monthly fee
- $0.00
- Monthly fee waiver
- -
- Special offers
- -
- Brokerage details
- $7.70 brokerage for trades under $100,000, then 0.05%.
- Settle from any bank account
- Settlement account offered
- Macquarie Cash Management Account
- CHESS ownership available
- Share pack
- Independent broker reports
- International markets
- Options
- Warrants
- IPOs
- Live data
- Market depth data
- Real time charting
- Other restrictions
- -
Read our Mozo Review to learn more about the Share Trading
Tiger Account
Small trade brokerage
Monthly fee
$2.99$0.00Tiger Brokers is an online broker listed on NASDAQ. It offers access to US, ASX & HK stocks, ETFs and US options trading. Mozo special offer for new users only: 7% p.a. on uninvested cash balance up to AUD $100,000 for the first 30 days, with a value up to AUD $575. Plus receive US$30 NVIDIA (NVDA) fractional shares with an accumulated deposit of at least AUD $2,000 within 7 days of the first deposit. T&Cs apply – for full details, go to the Tiger Brokers website.
Tiger Account
Tiger Brokers is an online broker listed on NASDAQ. It offers access to US, ASX & HK stocks, ETFs and US options trading. Mozo special offer for new users only: 7% p.a. on uninvested cash balance up to AUD $100,000 for the first 30 days, with a value up to AUD $575. Plus receive US$30 NVIDIA (NVDA) fractional shares with an accumulated deposit of at least AUD $2,000 within 7 days of the first deposit. T&Cs apply – for full details, go to the Tiger Brokers website.
- Monthly fee
- $0.00
- Monthly fee waiver
- -
- Special offers
- Mozo special offer for new users only: 7% p.a. on uninvested cash balance up to $100,000 AUD for 30 days valued up to AUD $575. Plus get USD $30 NVDA fractional shares with a deposit of AUD $2,000 within 7 days of the first deposit. T&Cs apply.
- Brokerage details
- 0.03% of trade value, $2.99 minimum brokerage.
- Settle from any bank account
- Settlement account offered
- no
- CHESS ownership available
- Share pack
- Independent broker reports
- International markets
- Options
- Warrants
- IPOs
- Live data
- Market depth data
- Real time charting
- Other restrictions
- -
Read our Mozo Review to learn more about the Tiger Account
Share Trading
Small trade brokerage
Monthly fee
-$0.005000+ stocks and 19 exchanges all on the eToro app. Invest in ETFs with $0 commission and stocks with just US$2 per trade. Join the world’s leading social trading platform, trusted by 30+ million users worldwide.
Share Trading
5000+ stocks and 19 exchanges all on the eToro app. Invest in ETFs with $0 commission and stocks with just US$2 per trade. Join the world’s leading social trading platform, trusted by 30+ million users worldwide.
- Monthly fee
- $0.00
- Monthly fee waiver
- -
- Special offers
- -
- Brokerage details
- $2 USD brokerage fee for stock trades, 0.5% fee is applied to all funds paid into or taken out of the USD settlement account
- Settle from any bank account
- Settlement account offered
- Customer funds are held in a Trust Account managed by JP Morgan Chase and Co
- CHESS ownership available
- Share pack
- Independent broker reports
- International markets
- Options
- Warrants
- IPOs
- Live data
- Market depth data
- Real time charting
- Other restrictions
- $5 USD withdrawal fee applies and a $10 monthly inactivity fee is charged after 12 months with no login activity.
Read our Mozo Review to learn more about the Share Trading
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