It was originally called Bendigo after Bendigo Creek (which I was told was named after an aboriginal shepherd called Abednigo). It then became Sandhurst after the British military academy of that name, until the locals changed it back to Bendigo in the 1890s.
However this is more likely - "Bendigo is the only Australian town named after a boxer. In the 1850s there was a world-famous English boxer named Abednego William Thompson. His nickname was Bendigo. Such was his fame that a local shepherd, because he was a good boxer, was called Bendigo in his honour. A local creek was named after the shepherd and so, when the town came to be named, the tradition continued. The town didn't become Bendigo officially until 1891. Before then it was known as Sandhurst".
I visited Bendigo NZ about six years ago - not very imoressive but similar quartz vein gold to Victoria.