Blockchain Australia, the industry body representing the blockchain and digital currency sector in Australia, has taken proactive measures in response to the recent banking limits imposed on cryptocurrency payments. These restrictions were introduced by the Commonwealth Bank (CBA) due to concerns over scams and customer losses associated with crypto transactions.
The CBA’s measures include the potential declination or 24-hour holding of certain payments to crypto exchanges to protect customers from scams. Additionally, the bank plans to implement a monthly payment limit of AUD 10,000 ($6,700) to crypto exchanges in the near future. James Roberts, the Commonwealth Bank’s general manager of fraud management, highlighted the aim of reducing the number of scams and financial losses suffered by customers through these measures. He emphasized the higher risk of scams faced by customers making payments to crypto exchanges. The CBA is also set to introduce NameCheck anti-fraud technology to external organizations processing payments in Australia to combat scams and fraud.
In response to the increasing restrictions on crypto payments, Blockchain Australia has launched new initiatives to address the issue of crypto scams and fraud. These initiatives involve educating consumers about cryptocurrencies and their benefits, including methods to identify scams. The organization also aims to recognize industry participants who adopt best practices recommended by banks. Moreover, Blockchain Australia is organizing an “Industry Roundtable” on June 27, 2023, to foster collaboration among the blockchain industry, banking and finance sector, and the government to combat scams in Australia. The roundtable has invited various stakeholders, including government officials, regulatory bodies, industry associations, major banks, and other concerned parties.
Jackson Zeng, CEO of Caleb and Brown, expressed concerns over the banking institutions’ decision to restrict millions of customers from making payments to cryptocurrency exchanges, considering it a significant curtailment of economic freedom in Australia. Lisa Wade, CEO and Deputy Chair of Blockchain Australia, highlighted the potential of blockchain and Web3 technologies and stressed the importance of Australia’s involvement in their development. She urged industry players and the government to collaborate in combating scams and fraud, which is crucial for overcoming financial exclusion.
Blockchain Australia believes that blanket restrictions have adverse consequences and suggests that banks providing opt-in protection and education to users or implementing targeted approaches for specific at-risk customer categories, accompanied by appropriate education and notification, may prove more effective in reducing crypto-related scams.
Australia has been intensifying scrutiny of the cryptocurrency sector. Binance Australia recently informed customers of the loss of access to Australian dollar deposits and withdrawals due to a decision made by its third-party service provider. While the provider not disclosed, reports suggested it was Westpac, one of Australia’s largest banks. Westpac separately announced a ban on fund transfers to several crypto exchanges.
In March, Australia’s prudential regulator, APRA, instructed banks to report their exposure to crypto firms and startups following the collapse of Silicon Valley Bank and the ensuing turmoil in the banking sector. APRA urged local banks to enhance their reporting on crypto assets and provide daily updates to gain better insights into potential vulnerabilities in the financial system.
