Major Australian bank to decline ‘certain’ payments to crypto exchanges

June 8, 2023 Coin Telegraph

CBA

James Roberts, Commonwealth Bank General Manager of Group Fraud Management Services cited a huge scale of "investment scams" involving crypto exchanges.

Commonwealth Bank (CBA), the largest bank in Australia, has said it will decline or temporarily hold certain payments to cryptocurrency exchanges, citing the risk of scammers.

The move comes amid two major global exchanges facing a lawsuit from the United States securities regulator and is just a few weeks after another major bank, Westpac banned customers from transacting with crypto exchange Binance.

On June 8, CBA said it would decline or put a 24-hour hold on "certain payments to cryptocurrency exchanges." The bank did not explain which exchanges or payment types that would be impacted by the new measures.

Reporting from @jessicasier @FinancialReview that @CommBank have banned AUD transfers to “high-risk” crypto exchanges & limited transactions with others to $10k per month, with a 24 hr delay. $700k per day leaves CBA as scammed money heading to crypto. Banks & the crypto industry…
— Caroline Bowler (@CaroBowler) June 8, 2023

"Commonwealth Bank has today introduced new measures to help protect customers from scam risks associated with making certain payments to cryptocurrency exchanges," it wrote in a statement.

It added a $6,650 ($10,000 Australian dollar) per month limit on customers sending funds to crypto exchanges to purchase cryptocurrencies would be introduced "in the coming months."

"From today, CBA will decline or hold for 24 hours certain payments to cryptocurrency exchanges. In coming months the Bank will also introduce $10,000 limits in a calendar month where the Bank can identify the customer payments are to exchanges for cryptocurrency purchases," it said.

The general manager of CBA's fraud management services, James Roberts, claimed that "scammers globally are capitalizing" on the interest in crypto, pretending to be "legitimate investment opportunities or diverting funds into cryptocurrency exchanges."

The bank said the measure would be "subject to ongoing review" and it would monitor the impact of the measures.

Aussie banks ANZ and NAB won’t ‘endorse’ retail speculation on crypto

June 1, 2022 Coin Telegraph

ANZ

Executives from two of Australia’s “big four” banks have said they won’t allow their retail customers to trade crypto with ANZ, adding they’re happy they didn’t “go head long” into a cryptocurrency offering.

Executives at two of Australia’s “big four” banks have ruled out allowing retail customers to trade cryptocurrency on their platforms, with one reasoning that customers don’t understand “basic financial well-being.”

Speaking at the Australian Financial Review Banking Summit on Tuesday Maile Carnegie, executive for retail banking at Australia and New Zealand Banking Group (ANZ), said that from speaking to retail customers, she believed “the vast majority of them don’t understand really basic financial well-being concepts.”

“Are we really going to make it easier and less friction and implicitly endorse speculating on crypto when they don’t understand basic financial well-being? The answer was no.”

Carnegie said ANZ had considered a cryptocurrency product from as early as 2017, adding she was “happy we didn’t go head long” into the offering.

Also attending the summit was Angela Mentis, chief digital officer of National Australia Bank (NAB), who was asked if NAB would consider offering crypto trading. She answered “not in the foreseeable future and not for retail” but added there are already applications for blockchain technology for institutional clients.

In March, ANZ became the first bank in Australia to mint an Australia dollar (AUD) pegged stablecoin called A$DC, and NAB is also gearing up to launch its own stablecoin, which is expected to be operational by the end of 2022.

Both stablecoin projects from the big banks will initially be offered to institutional clients seeking an on-ramp for crypto investments. The pilot transaction of A$DC, for example, was a 30-million-AUD transfer.

The only big four bank with plans to launch a retail crypto trading product is the Commonwealth Bank of Australia (CBA). At the summit, its CEO, Matt Comyn, said despite facing challenges, it was still its “intent” to launch the service.

The CBA revealed plans to enable crypto trading in November 2021 by partnering with the Gemini crypto exchange, with limited trials beginning shortly after. But in April, news emerged that the Australian Securities and Investment Commission had tied up the launch with regulatory red tape, citing concerns about consumer protections, which prompted the CBA to start planning a second pilot of the product.

In late May, the CBA put its plans for the second pilot on hold indefinitely and cut off crypto trading to those in the first round of testing, with Comyn saying at the time the bank was still waiting on regulatory clarity.

At the summit, Comyn added that if it were to proceed with the offering, the bank would look to restrict trading to those “who understand the risky asset class.”

Hitting back at the comments from the banking executives, Ian Love, founder and CEO of crypto investment firm Blockchain Assets, tweeted:

“How will we ever reduce wealth inequality when our regulatory system has financial discrimination at its core? It’s time to remove the ‘Sophisticated Investor’ discrimination rules that advisors use to hide behind and allow everyone access to financial advice and services.”

Commonwealth Bank puts crypto trading trial on ice as regulators dither

May 20, 2022 Coin Telegraph

ASIC

Commonwealth Bank of Australia CEO Matt Comyn insists his bank will move forward with the second pilot of crypto services on its app once regulatory uncertainty is cleared up.

The Commonwealth Bank of Australia (CBA) has put its plans for a second pilot program of crypto trading services on hold indefinitely and cut off access to those in the first round of testing.

CBA sent Cointelegraph a transcript of a Tuesday bank briefing where CEO Matt Comyn said that he was still waiting on regulatory clarity. He also said that he was “working with a number of regulators very closely, as you would imagine, about the appropriate treatment of this particular product.”

“Our intention still, at this stage, is to restart the pilot, but there are still a couple of things that we want to work through on a regulatory front to make sure that that is most appropriate.”

Comyn said there is a Treasury submission for the program already under review, but he did not share any expected timeline for its completion.

Comyn said that last week’s wild volatility appeared to support the need for the extended delay even though the second pilot program had already been put on ice by April after financial regulators balked at giving regular bank users’ easy access to crypto. The Australia Securities and Investment Commission (ASIC) objected to the CBA’s services on the grounds that consumer protections were absent.

He said “It is clearly a very volatile sector that remains an enormous amount of interest.”

“But alongside that volatility and awareness and I guess the scale, certainly globally, you can see there is a lot of interest from regulators and people thinking about the best way to regulate that.”

Comyn also suggested that the bank was awaiting the result of Saturday’s Federal election. If a new regime comes into power, it could spell broad changes in the crypto regulatory landscape which Comyn said “will be a focus for the incoming government to think about.”

Leadership and entrepreneurship lecturer at Swinburne University Dr. Dimitrios Salampasis told The Guardian that CBA may be going slowly in case of reputational damage.

Taking into account the recent price crash across the crypto markets due to the collapse of Terra (LUNA), Dr. Slampasis said “balancing risk, brand equity and regulatory clarity will be key so as to minimize disruption in CBA’s current business model.”

The CBA was the first major bank in Australia to offer crypto services through its mobile app last November. As the pilot program proceeded, it promised access to the app’s 6.5 million users once fully rolled out. As of now, those plans are on hold indefinitely.

Australian Tax Office says it can’t rely on crypto users’ own records

November 26, 2021 Coin Telegraph

ATO

“Our main concern is that many taxpayers believe their cryptocurrency gains are tax-free or only taxable when the holdings are cashed back into Australian dollars,” said the ATO commissioner.

The Australian Tax Office (ATO) says it can’t rely on crypto investors to keep track of their crypto transactions and profits — even though most investors try their best.

Speaking at the 14th International ATAX Conference on Tax Administration conference on Nov. 23, ATO commissioner Chris Jordan stressed that many new crypto investors may not entirely understand their tax reporting obligations:

“In a sector that is growing rapidly with new investors, we can’t rely on taxpayers knowing they need to keep records of their investment income and capital gains and disclose it on their tax returns.”

“Our main concern is that many taxpayers believe their cryptocurrency gains are tax-free or only taxable when the holdings are cashed back into Australian dollars,” he added.

Jordan explained that the ATO has been working on ways to “nudge” people in the right direction such as pre-filling data on tax returns to prompt crypto users to report their investments.

The commissioner also said the ATO has ramped up its trading data matching capabilities in 2021 by sourcing information from cryptocurrency demand-side platforms (DSPs), share registries and brokers.

“We’ve expanded our data matching protocols to get more data from third parties to assist with emerging investments like cryptocurrency.”

He added that, “We are working hard to improve the way we collect, manage, share, and use data, but we are just scratching the surface.”

Jordan did note however that “most people do the right thing” as tax reporting compliance, or the “tax performance” of individuals and small businesses in Australia is high with “little or no intervention” from the ATO at 94% and 87% respectively.

Chainalysis down under

A firm that the ATO may call on in future is the Commonwealth Bank of Australia’s partner Chainalysis.

On Nov. 24, Chainalysis’ country manager in Australia and New Zealand Todd Lenfield told the Australian Financial Review that his firm is hoping to provide key expertise to AUSTRAC and the ATO.

“We want to have conversations with AUSTRAC about what they are looking to regulate and explain to the tax office the lessons that can be learned from what the IRS is doing. We can take experience we have got in the space, and provide a local flavor,” he said.

The firm currently provides blockchain analysis services for the U.S. Federal Bureau of Investigation and Internal Revenue Service, it also investigated Russia-based crypto business Suex OTC which was targeted by the U.S. Treasury Department in September over facilitating transactions for ransomware payments.

Australia’s Rest Super retirement fund to invest in crypto for its 1.8M members

November 24, 2021 Coin Telegraph

AustralianSuper

“It’s still a very volatile investment, so any allocation exposure we make to cryptocurrencies is likely to be part of our diversified portfolio,” said Rest Super’s CIO Andrew Lill on Tuesday.

Australian superannuation fund Rest Super is set to become the first retirement fund in the country to invest in cryptocurrencies.

The fund has more than $46.8 billion worth of assets under management (AUM) and around 1.8 million members. Superannuation is the equivalent of a 401k or Individual Retirement Account in the U.S. and is compulsory for all employees. Until now the $2.4 trillion sector has been extremely cautious about cryptocurrency.

During Rest Super’s annual general meeting on Nov. 23, the firm’s chief investment officer Andrew Lill told members that the company sees digital assets as an “important part” of its portfolio moving forward but will proceed “carefully and cautiously,” noting that:

“It’s still a very volatile investment, so any allocation exposure we make to cryptocurrencies is likely to be part of our diversified portfolio as initially a fairly small allocation that may, over time, build.”

Lill went on to add his view that offering members exposure to crypto and blockchain tech could provide a “stable source of value” amid a time in which investors are flocking to crypto as a hedge against fiat-based inflation.

“I do think that, in an era of inflation, it could be a potentially good place to invest,” he said.

Following the CIO’s speech, a Rest spokesperson clarified in a statement that it is “certainly considering cryptocurrencies as a way to diversify our members’ retirement savings [but] will not be investing in the immediate future.”

“We are currently conducting extensive research into the asset class prior to making any decisions,” the spokesperson said. “We are also considering the security and regulatory aspects of investing in this class."

The comments are in contrast to those from Australian Super this week, with the chief executive of $167 billion fund Paul Schroder stating on Monday that “we don’t see cryptocurrency as investible for our members.”

Last month, it was reported that state owned investment fund Queensland Investment Corporation (QIC) was looking at gaining crypto exposure. However the firm told Business Insider this week that the reports were “incorrectly implied" and played down any digital asset adoption moves.

QIC’s head of currency Stuart Simmons also said while he expects superannuation funds to adopt crypto in the future, it’s “ probably going to represent a trickle, rather than a flood.

The discussion comes at a potentially bullish time for the Australian crypto market, following the development of extensive regulatory proposals in October by a Senate committee as part of a push to develop the nation into the next crypto hub, along with Commonwealth Bank of Australia’s (CBA) move to provide crypto trading via its banking app earlier this month.

While the country awaits to see what major traditional finance firm will be the next to embrace crypto, the CBA’s CEO Matt Comyn stated earlier this week the bank was more motivated by FOMO as opposed to being worried about risks associated with digital assets.

“We see risks in participating, but we see bigger risks in not participating,” he said.

Commonwealth Bank of Australia recognizes risks in missing out on crypto

November 23, 2021 Coin Telegraph

ASIC

“We see risks in participating, but we see bigger risks in not participating,” said CBA CEO Matt Comyn on the bank’s recent crypto adoption play.

Matt Comyn, the CEO of the Commonwealth Bank of Australia (CBA), said that the bank is more concerned about the risks of missing out on crypto than those associated with its adoption.

The CBA is set to become the first of the “big four” banks in Australia to offer crypto-based services, after the company announced on Nov. 3 that it will support the trading of 10 digital assets directly via its banking app.

Speaking with Bloomberg TV on Friday, Nov. 19, Comyn was questioned on the CBA’s take on the crypto sector, with the CEO noting that:

“We see risks in participating, but we see bigger risks in not participating. It's important to say that we don’t have a view on the asset price itself, we see it as a very volatile and speculative asset, but we also don’t think that the sector and the technology is going away anytime soon.”

Comyn also suggested that there will be much more to come from the CBA’s crypto adoption play, as he highlighted that the bank sees many use cases from blockchain tech, along with strong demand from consumers.

“And so we want to understand it, we want to provide a competitive offering to customers with the right disclosure around risks. We want to build capability in and around DLT and blockchain technology,” he added.

ASIC holds no FOMO and can’t regulate the sector

While the CBA appears to be bullish on crypto and distributed ledger tech, the Australian Securities and Investments Commission (ASIC) has urged for investor caution while also noting that it is unable to oversee the sector.

Speaking at the Australian Financial Review Super & Wealth Summit on Nov. 22, ASIC chairman Joe Longo suggested that the financial enforcer cannot regulate crypto as the asset class currently does not fall under the scope of “financial products” in Australia:

“The demand-driven nature of the rush into crypto has thrown up some unique challenges. At present many crypto-assets are probably not ‘financial products’, making it difficult for financial advisers to offer counsel.”

“ASIC has already provided some guidance on exchange-traded funds linked to crypto-assets — they at least are financial products and traded on a licensed exchange, so there will be some protections there — but for the most part, for now at least, investors are on their own,” he added.

In Longo’s personal view, he urged local investors to pursue crypto with great caution, noting that “the maxim ‘don’t put all your eggs in one basket’ comes to mind.” However, he also emphasized that the crypto proposals put forward by the Australian Senate last month was the right move for the local climate.

“Wherever we land from a policy perspective, Senator Bragg’s committee was right to highlight the fact that crypto is on our doorstep, here and now, and being driven by extraordinary consumer and investor demand,” he said.

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.

CBA

Chainalysis down under

ASIC holds no FOMO and can’t regulate the sector

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