Commonwealth Bank (CBA), Australia’s largest bank, recently announced new regulations imposing a monthly transfer limit of $10,000 to accounts or merchants associated with crypto exchanges. These changes, geared towards combating rising cryptocurrency scams, follow ACCC’s report revealing losses of over $220 million to cryptocurrency scams in 2022 alone. Payments exceeding the stipulated limit will be summarily declined, and though withdrawals from crypto exchanges to customer accounts remain unrestricted, the move has ruffled feathers.
The decision has not been without controversy. Several CBA customers have already initiated transitions to other banks or closed their accounts outright in response. Conversely, others back the bank’s decision, highlighting the precarious situation banks are in, striving to safeguard their customers from an array of online deceptions.
It’s not just CBA adopting this conservative approach. National Australia Bank (NAB) had earlier placed its own cryptocurrency transfer limits. Westpac, on its end, preempted the others by being the first to block certain crypto payments. ANZ has also embraced similar measures in its bid to curb scams.
CBA’s decision is even more intriguing considering its aborted venture into the crypto domain. In 2021-22, CBA had grand designs of launching its crypto services, even recruiting personnel to that end. However, following the significant crypto market correction in 2022, those plans were shelved.
Amidst this tightening financial landscape, Blockchain Australia, the industry body, has vehemently opposed these banking restrictions. Jackson Zeng, director of Blockchain Australia, remarked that such constraints hamper the nation’s economic freedom. The advocacy group believes that banks should primarily facilitate financial decisions, not restrict them. Blockchain Australia’s stand also suggests that these blanket restrictions could inadvertently push individuals toward less visible scams.
To address these concerns, Blockchain Australia is gearing up to host a roundtable discussion later in June. The hope is to engage policymakers, potentially roping in influential figures such as Assistant Treasurer Stephen Jones and the Australian Securities and Investment Commission. The industry body also plans to initiate a consumer education program about cryptocurrencies, emphasizing recognizing scams and credible crypto actors.
There’s an overarching suspicion that major banks might be stifling established crypto players to introduce their platforms, especially considering global trends. With finance giants like Blackrock launching ETF services, is this a calculated move by the banks to squeeze liquidity from crypto exchanges?
Banks and cryptocurrencies have always had an intriguing relationship, and Australia’s latest chapter is no exception. As the dust settles and as more information emerges, the ultimate question remains: is this a genuine attempt to safeguard the Australian public or a strategic gambit in the ever-evolving financial chessboard?
