Blockchain Australia CEO calls for unified efforts to stamp out crypto scams

June 30, 2023 Coin Telegraph

Australian Competition and Consumer Commission

Simon Callaghan said that efforts need to start on social media and telecommunication channels where most cryptocurrency scams originate.

Blockchain Australia’s new CEO, Simon Callaghan, is urging Australia’s banks, the government and the crypto industry to come together to combat rising cryptocurrency scams.

Speaking on the final day of Australian Blockchain Week in Melbourne on June 30, Callaghan announced that the association will now be focused on helping prevent scams that involve crypto, among its other efforts.

*Simon Callaghan speaking at Australian Blockchain Week on June 30. Source: Cointelegraph*

“We’re going to have to work with the banking sector. We’re going to have to work with the government,” the CEO said, stressing the need to protect consumers.

Callaghan however noted that scams often originate on social media or through telecommunication channels — noting that policing efforts need to start from the point of first contact:

“Crypto is either an exit point or minor piece in the lifecycle of the scam, the scam happens much further up the chain.”

The CEO noted that few countries have managed to cooperate efficiently to combat cryptocurrency scams so far, but shared hopes Australia can break that barrier and set an example for other jurisdictions:

“If we can take some leadership on that in Australia, I think we can certainly take that forward globally as well.”

Cryptocurrency-related scams have been a headline issue in Australia over the past month. Since May, two of Australia’s largest banks imposed restrictions or outright bans on certain payments made to cryptocurrency exchanges, citing the rising threat of scams.

The Australian government has also shown interest in tackling the issue, with the Australian Competition and Consumer Commission (ACCC) — the country’s consumer watchdog — set to open its National Anti-Scam Center on July 1.

According to the ACCC, the NASC will collate expertise and resources to prevent scammers from making contact with Australians and to raise consumer awareness about how to avoid scams.

Blockchain Week Day 5 in Melbourne has kicked off with @MikeBacina, Chair - Blockchain Australia. #BW2023 pic.twitter.com/sfD53BJyQJ
— Blockchain Australia (@BlockchainAUS) June 29, 2023

Trevor Power, an Australian Treasury assistant secretary, told Cointelegraph on June 26 that the Australian government is investing heavily into reducing scams and that cryptocurrency-related scams will be a focus for the NASC:

“I think it has been pointed out that crypto at the moment is a significant vector for scams, and so obviously, it’s part of the center of their work; they will also be focusing on crypto.”

Earlier this week, Blockchain Australia said it planned on examining scam data collected from cryptocurrency exchanges and, from that, share the best practices for scam and fraud prevention.

Blockchain Australia is the peak industry body for blockchain in Australia. The body represents 111 blockchain-based firms operating in Australia, according to the firm’s website.

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Don’t follow the US: Blockchain Aus CEO hammers ‘regulation by enforcement’

June 25, 2023 Coin Telegraph

appointment

Blockchain Australia, the country’s peak crypto industry body has announced a new CEO who wants to speed up the crypto regulatory process.

Blockchain Australia’s new CEO Simon Callaghan hopes the Federal Government will take its cues on crypto regulation from the United Kingdom, Hong Kong, and Singapore — and definitely not the United States.

In his new position, Callaghan aims to steer crypto rule-making in the country and avoid making similar moves to the U.S. Securities and Exchange Commission — which is suing the world’s two largest exchanges and has branded at least 68 tokens as securities.

“Regulation by enforcement is the equivalent of having a hammer and seeing everything as a nail. I don’t think that’s the right approach for Australia to be taking.”

*Callaghan gave a speech at Blockchain Week, announcing his tenure as Blockchain Australia's CEO.*

On June 26, Callaghan was announced as the industry peak body’s new CEO. He was most recently the digital assets program lead for Cambridge University and a co-founder of corporate service provider MOOPS Tech.

*A recent post from Simon Callaghan regarding leaving his Cambridge role. Source: Linkedin*

Callaghan’s previous roles include a year as the Asia lead for crypto lender Celsius as, but he left several months before the firm’s collapse. He has also had a brief stint at crypto lender Vauld.

His appointment comes after nearly a year of limbo following the departure of former CEO and industry advocate Steve Vallas in July 2022. The CEO role was briefly filled by Laura Mercurio in September last year, but she parted ways with the organization just weeks later over a difference of vision, effectively leaving Australia’s blockchain industry without an advocate for the better part of a year.

In his new role, Callaghan will represent the association’s 112 members, including Binance Australia, Circle, Ripple, and Mastercard, all of who are calling for clearer regulation, adding:

“Everyone wants to know where the goalposts are so people can operate their businesses, build their technologies and create jobs."

The Australian government has not taken a hardline stance on crypto, unlike American regulators and the Biden administration, Callaghan told Cointelegraph.

The Treasury has a “token mapping exercise” underway to determine how to classify various digital assets ahead of any legislation, which isn’t expected until at least 2024.

“We haven’t seen a strong position really one way or the other from this current government. That could be because they’re looking to take a considered approach, which I would argue is a good approach,” he said.

Consultation open! Today we released the token mapping consultation paper. This consultation is part of a multi step reform agenda to develop an appropriate regulatory setting for the #crypto sector. Read paper & submit views @ https://t.co/4W2msjhP9B @ASIC_Connect @AUSTRAC pic.twitter.com/OGHuZEGvDp
— Australian Treasury (@Treasury_AU) February 2, 2023

He hopes legislators take inspiration from Singapore, Hong Kong and the U.K. which are all developing regulatory schemes that aim to balance innovation with consumer protection.

“They see the benefit from the technology, the innovation, and the jobs it creates, as well as benefits to the broader financial sector.”

Reports earlier in June suggest the Hong Kong central bank has been putting pressure on major banks to accept crypto exchanges as clients, amid moves from the city to attract international crypto firms and investors.

“The fact that the Hong Kong monetary authorities are encouraging banks to work with the sector, I think that's the right approach,” Callaghan remarked.

In 2021, an Australian Senate committee report on digital assets recommended that crypto firms should be able to challenge debanking decisions and that banks should be required to conduct due diligence on firms rather than adopt blanket bans on the sector.

Two major Australian banks however recently imposed pauses, limits and outright blocks on certain payments to local crypto exchanges, both citing the growing threat of financial scams.

“I don't think you can just blanket everything in crypto as a scam, you actually need to look at the data,” said Callaghan, who revealed he’s already scheduled meetings “in the coming weeks” with the banks to further understand their position.

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BTC Markets becomes first Australian crypto firm to get a financial services license

June 21, 2022 Coin Telegraph

afs license

While the license isn’t currently needed for crypto companies in Australia, BTC Markets says it is preparing the exchange for upcoming regulations.

Australian-based cryptocurrency exchange BTC Markets has become the first crypto company in the country to gain a financial services license.

The license was issued by the country’s financial regulator, the Australian Securities and Investments Commission (ASIC), to BTC Markets’ sister company BTCM Payments.

We have an exciting announcement to make:

BTC Markets is the first Australian crypto exchange to successfully go through the full AFSL application process via our sister company, BTCM Payments!

✅AFSL attained
✅ISO Certified
✅SOC 2 on the way!#crypto #bitcoin #finance
— BTC Markets (@BTCMarkets) June 21, 2022

An Australian Financial Services (AFS) license allows the holder to give advice, deal in and create a market for a financial product. It also permits the provision of custodial or depository services, among other perks.

While crypto and digital asset companies don’t require an AFS to provide services due to the lack of regulation in the country, BTC Markets says the move allows it to more closely bridge the gap between traditional finance and crypto while offering new products to its customers.

It marks the end of an almost two-year wait for the firm for the AFS license, which was registered in August 2020.

BTC Markets has certification from the International Organization for Standardization (ISO) for information security management and is certified by the country’s crypto industry body, Blockchain Australia.

BTC Markets CEO Catherine Bowler said the license would prepare her exchange business for what she believes is impending regulation and complements its progress in obtaining a System and Organization Controls (SOC) 2 certification.

BTC Markets has established itself as a key player in the Australian crypto industry with $4.7 million in daily volume, according to CoinGecko.

In February, the exchange signed a deal with the stock market trading platform SelfWealth to offer SelfWealth users access to trade Bitcoin (BTC), Ether (ETH), Ripple (XRP), Chainlink (LINK) and Uniswap (UNI) from June 30.

Other exchanges have followed suit. Earlier this month, Australian crypto exchange Swyftx completed a $1.5 billion merger deal with online stock market investing platform Superhero.

Reserve Bank warns Aussies over punting on ‘fad driven’ cryptocurrencies

November 19, 2021 Coin Telegraph

Andrew Bragg

The Reserve Bank of Australia has warned local investors that the speculative frenzy on crypto could soon dry up if policymakers and regulators step in.

The Reserve Bank of Australia (RBA) has warned Aussie investors about speculating on digital assets as it casts doubt over the entire crypto sector.

During a Nov. 18 address to the Australian Corporate Treasury Association, the RBA’s head of payments policy Tony Richards offered an overview on distributed ledger tech, crypto assets, stablecoins, and central bank digital currencies (CBDCs).

In his speech, Richards raised questions over crypto’s validity and growth in 2021 as he took aim at the amount of capital invested into memecoins such as Dogecoin (DOGE) and Shiba Inu (SHIB):

“The recent boom in this area is perhaps best illustrated by the fact that Dogecoin, a cryptocurrency that was started as a joke in late 2013, had an implied market capitalization as high as US$88 billion in June this year.”

“And the Shiba Inu token, which appears to be equally free of any useful function, is currently the ninth-largest cryptocurrency, with a market capitalization of around US$26 billion,” he added.

Richards also asserted that public attention captured by crypto in 2021 was “no doubt fueled by influencers and celebrity tweets,” as he refuted the reported scope of how widespread crypto adoption really is in the country.

“Some surveys have claimed that around 20 percent of the Australian population hold cryptocurrencies, and one claimed that Dogecoin alone was held by 5 percent of Australians. I must say that I find these statistics somewhat implausible,” he said.

Richards outlined three scenarios in which the “current speculative demand could begin to reverse” in crypto that would essentially leave digital assets with minimal use cases in his opinion.

Firstly, he argued that investors may soon “be less influenced by fads” and FOMO and instead pay more attention to warnings of regulators and policymakers.

Secondly, he said that governments across the globe may aim to crack down on energy-intensive proof-of-work-based cryptocurrencies such as Bitcoin (BTC), and finally he said the tax authorities may aim to remove anonymity to clamp down on financial crime.

Commenting on Richards’ address, Steve Vallas the CEO of Blockchain Australia refuted the speculative-focused arguments against the entire sector, telling Cointelegraph that:

“Some regulators maintain an unhelpful and narrow focus on the speculative elements of the sector. That lens misses the remarkable infrastructure build that has occurred in recent years.”

A disappointing view in the face of a global opportunity to lead for Australia.

"RBA warns of ‘faddish’ crypto crash" https://t.co/9AIGlwmNoc via @eyersj @jessicasier
— Blockchain Australia (@BlockchainAUS) November 18, 2021

Crypto-friendly Senator Andrew Bragg, who is one of the key politicians behind the push to introduce robust crypto regulations in Australia echoed similar sentiments, noting that “the RBA is short-sighted on cryptocurrency. The utility and value to the economy of the technology is enormous.”

ANZ bank executive: The ‘weight of money’ means crypto can’t be ignored

November 5, 2021 Coin Telegraph

ANZ

“When you look under the hood on that, we've concluded that this is a major protocol shift for financial market infrastructure,” said Nigel Dobson, ANZ’s Banking Services Portfolio Lead.

One of the ANZ bank’s senior executives has told a Blockchain Australia forum that the crypto sector has grown too big to be ignored by traditional finance.

The comments came a day after rival Commonwealth Bank announced that it would roll out crypto trading services for 10 digital assets via its Commbank app.

The “State of Play” forum was held by Blockchain Australia on Nov. 4 and featured representatives from organizations including Mastercard, ANZ and NAB offering their take on the crypto sector in the wake of CBA’s play.

Today we hosted the 'State of Play' with over 1200 registrations and speakers from some of Australia's most recognisable businesses.

The conversation signalled very clearly that a revolution in payments is on our doorstep. pic.twitter.com/S32Vc4KToO
— Blockchain Australia (@BlockchainAUS) November 4, 2021

Nigel Dobson, ANZ’s Banking Services Portfolio Lead stated that the growth of the crypto and blockchain tech over the past 12 to 18 months has put the sector firmly on the bank’s radar:

“There's this sort of weight of money that you just simply at some point can't ignore right? And you know, in the DeFi world that we've been watching for a while or even in just the currency space, it's just the weight of money and the quality of money that's moving into these venues that it makes us think, well, what is happening here?”

“When you look under the hood on that, we've concluded that this is a major protocol shift for financial market infrastructure,” he added.

Dobson is a senior banker with more than 30 years of experience at Barclays, Citibank and ANZ. He likened the technological advancements brought about by blockchain tech to the transformative effects the Internet had on global commerce in the early 2000s.

“We're seeing the same kind of shift occurring here. We're shifting to more decentralized, arguably more trusted, more secure, faster, cheaper, better — yet to be proven —but if that's the thesis that these protocols can generate better outcomes and new business models, then they can't be ignored,” he said.

None of the other members of Australia’s big four banks has announced any immediate plans to follow CBA in enabling crypto trading. Dobson stated that it was unclear how CBA’s trial would go, but implied that the ANZ is likely to join the party at some stage.

“I think the move that the CBA made yesterday was bold and it is yet to be seen whether those customers will embrace that. But certainly all of what we've been talking about today, particularly in this section of the commentary, is that that the ship has sailed. And so what it is that we need to do is to navigate our path towards utilizing these networks,” he said.

The bullish comments mark a significant change from the bank, which recently settled a case with Canberra-based Bitcoin trader Aaron Flynn after he took legal action against ANZ over de-banking between 2018 and 2019 due to his work as a Digital Currency Exchange (DCE).

ACX’s parent company Blockchain Global collapses owing $15M

November 5, 2021 Coin Telegraph

<div>ACX's parent company Blockchain Global collapses owing M</div>

ACX

Investors are worried the may not be able to recoup their funds from ACX, now that parent company Blockchain Global has entered voluntary administration.

Blockchain Global (BGL), the parent company of the now-defunct Australian crypto exchange ACX, has collapsed with outstanding debts of $15 million.

On Sept. 13, The Victoria Supreme Court placed a freeze order on 117.33 Bitcoin (BTC) —worth around $7.1 million — held by two companies behind the exchange, BGL and ACX Tech. Three days later the companies were ordered to disclose the full scope of assets held locally and abroad but failed to meet the Sept. 30 deadline.

The Australian Financial Review reported that BGL has since entered voluntary administration, with a figure of $15 million (AUD $21 million) owed to creditors. BGL’s CEO Sam Lee said said that he stepped down as a director in March 2019, but still retains ownership of the brand.

Lee downplayed his current role at BGL, noting that:

“[I] was reappointed on April 12, 2020 to deal with matters after the company cease[d] to have any operations, as there is no operations, there were no key business decisions made, debt introduced during my absence wasn’t able to be negotiated.”

Speaking on the firm’s voluntary administration, Lee again distanced himself from BGL and said that the decision from the existing directors is “in the best interest of creditors and shareholders.”

“I abstained from all decision-making after my appointment as I didn’t have enough visibility to make informed decisions,” he said.

Melbourne-based ACX suddenly shut down operations and froze user accounts in early 2020, leading to around 200 investors claiming losses of a combined $7.4 million (AUD $10 million). The platform was promptly thrown out of Blockchain Australia and its digital currency license was revoked by AUSTRAC.

While ACX investors had renewed hope of recouping their funds following the freeze order on the hard wallet, the collapse of BGL has left things much more uncertain.

“It’s gotten so confused we are left wondering what the hell is going on,” an anonymous investor said.

The administrators' report on BGL says that it holds $7.77 million (AUD $10.5 million) worth of assets, and is owed $598,907 (AUD $809,669) in unsecured debt, with only $259,620 (AUD $350,983) thought to be recoverable.

Commonwealth Bank to enable crypto trading for 6.5M Aussies, ‘other banks will follow’

November 3, 2021 Coin Telegraph

ANZ

The CBA stated that it will support 10 crypto assets in its banking app, including Bitcoin, Ethereum, Bitcoin Cash and Litecoin.

The Commonwealth Bank of Australia (CBA) is set to launch crypto trading services for the 6.5 million users of its CommBank app.

The CBA will become the first bank in Australia to support crypto, and Blockchain Australia says it is “inevitable” that the other ‘big four’ banks including National Australia Bank (NAB), Australia and New Zealand Banking Group (ANZ) and Westpac will soon follow suit.

According to a Nov. 3 announcement, the CBA has partnered with the Gemini crypto exchange and blockchain analysis firm Chainalysis to launch its crypto services. The bank will launch a pilot for a limited number of customers in the coming weeks, before rolling out the full service in 2022.

Ten crypto assets will be supported in its banking app, with Bitcoin (BTC), Ethereum (ETH), Bitcoin Cash (BCH) and Litecoin (LTC) named at this stage.

Steve Vallas, CEO of Blockchain Australia told Cointelegraph that this move was “extraordinarily important” as the big four banks in Australia “underpin our national and international reputation as a financial services destination.”

“The confidence that this provides local digital asset sector participants will be dwarfed by the impact that this signal sends around the world that Australia should be a destination for cryptocurrency and digital asset adoption.”

Vallas believes the rapid growth and adoption of crypto has “shifted the risk of maintaining a wait and see approach” in the view of the big banks to a risk of “inaction” and being left behind. Vallas believes it is only a matter of time before the other major Australian banks launch their own crypto services.

“It is inevitable that the other banks will follow suit. Clarity in the local regulatory landscape is emerging with issues such as licensing being tackled head on by industry and by Governments. That impediments to action and participation are being removed,” he said.

Caroline Bowler, the CEO of local crypto exchange BTC Markets echoed similar sentiments to Vallas, noting that “with regulation in the offing and the largest bank in the country allowing it, the floodgates are now open for more appetite from traditional finance.”

“CBA's move is exciting and inevitable. It's yet another 'red-letter day' for crypto and it is as though Australia has suddenly put the lead foot down. We have been touted as playing catch up all this while, but now we're moving into a leadership position globally with our largest bank.”

Dave Abner, the Global Head of Business Development at Gemini said that his firm was “proud” to be working with CBA to launch world leading crypto services.

“The exponential growth of digital assets internationally, coupled with Gemini’s institutional-grade security and proactive regulatory approach, positions this partnership to set a new standard for banks and financial platforms in Australia and across the globe,” he said.

Not everyone was pleased with CBA’s partnership however, with Adrian Przelozny the CEO of Australian crypto exchange Independent Reserve expressing his dismay over the bank partnering with an overseas firm.

“It’s disappointing that CBA went with an overseas player and didn’t engage with local players at all. We will be reaching out to the other Australian banks now,” Przelozny said.

Cointelegraph reported on Oct. 15 that Allan Flynn, a Canberra-based Bitcoin trade settled his first complaint at the ACT Civil and Administrative Tribunal against ANZ for de-banking him in 2018 and 2019 due to his occupation as a Digital Currency Exchange (DCE).

While ANZ denied any liability, the bank offered him a chance to reapply for a bank account, suggesting that the bank is more open to crypto than it was two to three years ago. Flynn also has a similar case against Westpac ongoing.

Commenting on today’s news, Flynn told Cointelegraph that the crypto landscape in Australia is rapidly changing:

“There a lot of things suddenly happening in the Australian Bitcoin space; you have the Senate inquiry, ANZ’s acknowledgment of a legit human rights question to be answered in my complaint, AUSTRAC’s extraordinary statement on de-banking last Friday and now CBA’s digital currency plans being unveiled.”

“I’m just here arguing my lawful human rights and hoping it makes a difference,” he added.

Blockchain Australia

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