More Australians are dipping their toes into crypto than ever before. According to the Independent Reserve Cryptocurrency Index (IRCI), about one in three adults has owned or currently owns a digital asset. That means millions of people have already taken their first steps into the crypto world.

If you’re a first time crypto buyer, though, it can feel daunting. There’s excitement in buying your first Bitcoin, Ethereum, or meme coin, but there’s also uncertainty. What if you pick the wrong exchange? What if you fall for hype or a scam? What if you make a mistake that can’t be undone?

The reality is that beginners do make mistakes—and that’s okay. But the difference between those who learn and those who lose often comes down to awareness. Crypto doesn’t require you to be a tech wizard or a financial expert; it requires patience, curiosity, and a willingness to prepare before pressing “Buy.”

Together, we’ll unpack the 10 most common mistakes new traders in Australia make, from chasing FOMO trades to neglecting secure storage, and we’ll highlight what you can do instead. By the end, you’ll have a clearer picture of the risks, the opportunities, and the practical steps that make all the difference when starting out.

Mistake 1 – Not Choosing the Right Exchange

For many newcomers, the first mistake happens before they even buy a coin: choosing the wrong exchange. It’s tempting to sign up for the first flashy platform you see online, but not all exchanges are created equal. Some are unregulated, others hide fees in complex pricing, and a few may not even support Australian dollars, making deposits and withdrawals slow or costly.

In Australia, exchanges that deal with digital assets must be registered with AUSTRAC, the country’s financial intelligence agency. This registration means the platform complies with anti-money laundering and counter-terrorism financing rules, giving you a safer place to trade. Pair that with transparent fees, strong customer support, and secure wallet options, and you’ve got the foundation you need to start trading responsibly.

If you’re unsure where to begin, explore our guide: How to choose the right crypto exchange. It breaks down what to look for and why choosing the right starting point matters so much for beginners.

Mistake 2 – Trading Based on FOMO

If you’ve ever felt the urge to buy a coin simply because “everyone else is doing it,” you’ve met FOMO. In crypto, FOMO stands for “Fear of Missing Out.” It’s that anxious feeling that if you don’t jump in right now, you’ll miss the ride of a lifetime.

The problem? FOMO-driven trades often lead to buying at the peak. Think of the Dogecoin spikes in 2021. Prices surged after viral tweets and news headlines, only to plummet sharply soon after. Many beginners who chased the trend were left holding coins worth far less than they paid.

The smart move is to pause, research, and set a plan before you buy. Decide in advance why you’re buying, at what price you’re comfortable entering, and when you might sell. A clear strategy helps you avoid being swept up in hype cycles that can quickly turn into losses.

Mistake 3 – Neglecting Research (DYOR)

Crypto has its own golden rule: DYOR—Do Your Own Research.

It sounds simple, but skipping this step is one of the biggest pitfalls for beginners. Many first-time buyers rely on tips from social media, influencers, or friends who swear a particular coin is “the next big thing.” The result? People buy into projects with no real foundation, only to see them collapse when the hype fades.

How do you actually do your own research? Start by:

• Reading the whitepaper: This is the project’s roadmap, showing what it aims to achieve.
• Looking at the team: Who’s behind it? Do they have experience in blockchain or tech?
• Checking the data: Look at trading volume, market cap, and reputable news sources for context.

Key takeaway:
DYOR means researching a cryptocurrency project independently instead of relying on hearsay.

Taking time to understand what you’re buying may not feel as exciting as chasing the next trending token. Still, it’s one of the best ways to avoid unnecessary losses.

We’ve covered just two important crypto acronyms already: FOMO and DYOR. Feeling like the world of digital assets has its own language? It kind of does! To learn more of the lingo, check out our blog: Common Crypto Terms & Slang, and you’ll be keeping up with the best of them in no time.

Mistake 4 – Emotional Trading and Overreacting to Volatility

Crypto markets move fast. Prices can rise or fall by double digits in a single day, and for a first time crypto buyer, that rollercoaster can trigger panic. The instinct to sell everything during a dip, or to buy in excitement after a sudden surge, can often lead to losses.

Emotions and money don’t mix well, especially in markets as unpredictable as crypto. What feels like a smart reaction in the moment is usually just emotional trading, and it rarely ends well.

There are practical tools to help manage this:

• Limit orders: Allow you to set buy or sell points in advance, thereby removing the impulse factor.
• Dollar-cost averaging (DCA): Instead of going all in, you spread out your purchases over time. This smooths out the ups and downs.

By replacing gut reactions with simple strategies, you’ll find it easier to stay steady when the market swings.

Mistake 5 – Insecure Storage Methods

After buying their first coins, many beginners leave them sitting in an exchange hot wallet—the default wallet connected to the internet. While convenient, hot wallets can sometimes be more vulnerable to hacking attempts or even login security mistakes. For a first time crypto buyer, that risk can be the difference between holding assets safely or losing them.

A safer approach for long-term traders could be to explore other storage methods:

• Cold wallets: Hardware devices that keep your private keys offline and away from online threats.
• Two-factor authentication (2FA): A crucial login step that makes it much harder for anyone else to access your account.

Taking storage and safety seriously is part of owning crypto responsibly.

If you’re unsure where to start, check out our guide on Crypto Wallets 101: Which One Is Right for You?

Mistake 6 – Vulnerability to Scams

Scams aren’t unique to crypto—they happen everywhere money moves. Think of phishing emails pretending to be your bank, online shopping scams, or text messages claiming to be from Australia Post. Crypto is no different. The ACCC has highlighted that Australians lose millions each year to scams, whether through fake investment platforms, romance scams, or phishing attempts.

A significant driver behind this trend is social media. Platforms like Facebook, Instagram, and even dating apps have become common entry points for scams. Whether it’s a fake “investment opportunity” in crypto or a link claiming to be from your bank, the tactics are strikingly similar.

The key point? We don’t avoid banks because of the existence of scams. We learn how to spot the red flags, stay cautious, and use trusted services. The same approach works in crypto.

Here are a few habits that help keep your funds secure:

• Always double-check the website address before logging in.
• Treat unsolicited DMs or posts promising high returns with suspicion.
• Use AUSTRAC-registered exchanges, where regulation supports safer trading.

Staying educated and vigilant makes crypto as safe to use as other parts of your financial life.

Mistake 7 – Ignoring Regulatory Compliance

In Australia, crypto isn’t a lawless frontier, it’s regulated. The Australian Taxation Office (ATO) treats cryptocurrency as property, which means that buying, selling, or even swapping one coin for another can create a taxable event. For a first time crypto buyer, ignoring this can lead to headaches down the line if records aren’t kept or transactions aren’t reported correctly.

Failing to comply doesn’t just risk penalties, it also undermines the legitimacy of your trading. Staying on top of reporting requirements, even if you’re only dabbling with small amounts, is part of being a responsible trader.

How to buy my first crypto?
When you sign up with a regulated Australian exchange, you’ll need to complete Know Your Customer (KYC) checks. This means verifying your identity, usually with a driver’s licence or passport, before you can trade. It’s a standard process designed to protect users and align with AUSTRAC rules.

For a deeper dive into how the ATO views digital assets, check out our blog: 11 Things You NEED to Know About Crypto Tax in Australia. It’s one of the most important areas to understand from the very beginning.

Mistake 8 – Searching for “The Next Bitcoin”

Every bull run sparks the same dream—finding the next Bitcoin. Many beginners chase speculative “moonshot” coins, hoping to buy in at a few cents and ride them to life-changing gains. The reality? Few of these coins survive, and even fewer grow into long-term projects with genuine value.

For a first time crypto buyer, this mindset can lead to disappointment. Putting all your hopes on a single coin often means buying into hype without checking whether there’s a solid team, real-world utility, or active adoption behind it.

A steadier approach is to focus on established projects with proven track records. Look for cryptocurrencies that have clear use cases, strong communities, and ongoing development. They may not promise overnight riches, but they offer a more reliable way to learn the market and build experience without unnecessary risk.

Mistake 9 – Poor Portfolio Management

One of the quickest ways beginners run into trouble is by putting all their money into a single coin. It feels simpler, and sometimes the hype around one token makes it tempting. But this concentration risk leaves you fully exposed. If that coin drops sharply, so does your entire portfolio.

Diversification is the antidote. By holding a mix of coins that serve different purposes—such as payment coins, smart contract platforms, and stablecoins—you spread your risk and give yourself a chance to benefit from different areas of the market.

How to build a diversified crypto portfolio?
Start by spreading your holdings across multiple projects with different functions and levels of risk. This reduces reliance on a single outcome.

How many crypto coins should I have in my portfolio?
There’s no single right number, but most beginners start with a handful of well-known, established projects rather than chasing dozens of smaller coins.

For practical tips, see our blog on Crypto Portfolio Diversification. It breaks down how to think about balance and why variety matters for long-term stability.

Mistake 10 – Mistakes with Wallet Transactions

Crypto transfers are final. If you send to the wrong wallet address or choose the wrong network, there’s usually no way to reverse it. The same goes for passwords and seed phrases: lose them and access to your coins is gone.

Common traps for a first time crypto buyer include:

• Network mismatches: sending a token on the wrong chain (for example, selecting BNB Smart Chain instead of Ethereum) so the funds never arrive where you expect.
• Missing tags/memos: some assets, like XRP and XLM, require a destination tag or memo on exchanges; omit it and your deposit may be unrecoverable or delayed.
• Copy-paste errors: one wrong character in an address can send funds to a different destination.

Action steps that save headaches:

• Triple-check the asset, address, and network before you hit send.
• Start with a small test transaction, then send the full amount once confirmed.
• Use your exchange’s address book or QR scanning to reduce typos.
• Store your seed phrase offline in two separate secure locations; never in email, cloud notes, or photos.
• Keep a simple transaction checklist on your desk or phone to follow every time.

Get these habits right and transfers become routine rather than stressful.

Next up, let’s tackle the most common questions new Australian traders ask before their first buy.

Common Questions First-Time Buyers Ask

Stepping into crypto for the first time comes with a flood of questions. Here are some of the ones we hear most often from first time crypto buyers in Australia:

How to buy my first crypto?
The easiest path is through a local, AUSTRAC-registered exchange. You’ll sign up, verify your ID, deposit Australian dollars (often with PayID or bank transfer), and place your first order. Think of it like opening an online bank account—straightforward, but with an exciting twist.

What is the best crypto exchange in Australia?
Look for an exchange that is registered with AUSTRAC, offers transparent fees, local AUD support, and responsive customer service. Digital Surge, for example, was built for Australians and ticks these boxes with over 400 coins listed.

How to do crypto research?
Don’t just rely on tips floating around social media. Real research involves reading whitepapers, checking the project’s website, exploring reputable data platforms like CoinGecko, and assessing the community’s activity level. Our How to Research Cryptocurrencies Before Buying guide is a good starting point for building that foundation.

What does FOMO mean in crypto?
FOMO, or “Fear of Missing Out,” is when traders buy in a panic because prices are spiking and they don’t want to be left behind. It’s one of the quickest ways to lose money if you don’t have a plan.

How to build a diversified crypto portfolio?
Diversification involves spreading your holdings across different sectors, purposes, and utilities, rather than putting everything into one coin. Some might balance Bitcoin with Ethereum, stablecoins, and a few projects with clear use cases.

How many crypto coins should I have?
There isn’t a magic number. Some beginners start with one or two coins to learn the ropes, while others hold five to ten. What matters most is understanding why you own each coin and how it fits into your overall risk tolerance.

Learn Before You Leap

Every first time crypto buyer is bound to make a few stumbles. The difference is whether those stumbles are small lessons or costly mistakes. From chasing hype cycles to overlooking storage security, the top 10 pitfalls we’ve explored all share a common thread—they can be avoided with the right education and preparation.

Crypto in Australia isn’t a gamble when approached thoughtfully. Regulation, transparent exchanges, and solid educational resources are already in place. What matters is slowing down enough to use them. Learn the basics, understand the risks, and trade on platforms designed to keep Australian users supported and compliant.

If you’re ready to take that first step, make it a smart one.

Start with Digital Surge, Australia’s trusted crypto exchange, and trade with clarity from day one. Sign up today.