The National Australia Bank (NAB) is reportedly closing the account of a long-time customer who is also a Bitcoin (BTC) holder without providing a reason. According to a new Daily Mail report, the $455 billion NAB notified customer Shane Lucas, 49, that he has until October 14th to close his bank accounts or the bank […]
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Cointelegraph spoke to former senior executives in traditional finance who've made the move to crypto. Would they ever go back?
Despite plenty of regulatory action in the United States and an ongoing crypto winter, former TradFi executives, now in crypto, said there’s no desire to return to their old banking lives.
Instead, several former traditional bankers told Cointelegraph they remain bullish about the industry's future and love the fact they can actualize real innovation.
Lisa Wade, CEO of DigitalX, is one such executive, having pivoted to crypto in December 2021. She was once the head of innovation and sustainability at National Australia Bank (NAB), one of Australia’s Big Four banks.
DigitalX Funds Limited (ASX:DCC) announced that it has recruited Lisa Wade (she/her) Wade as its new Chief Executive Officer.#executiveleadership #citi #natwest #nabhttps://t.co/lxORT3KDJp
— Finance Magnates (@financemagnates) December 23, 2021
Wade told Cointelegraph that the crypto industry provides her with greater freedom to take innovative risks compared to the banking sector.
“It is becoming very obvious Web3 financial rails are the future — it is hard to innovate internally so those of us with a fire in our bellies are jumping ship.”
Wade holds the belief that crypto will witness widespread adoption in the coming years, stating that “like ESG, this will be mainstream in 10 years or sooner.”
She added that she moved over to the crypto industry to “build something great […] in a way that a bank couldn’t.”
Similarly, Guy Dickinson, the CEO of carbon trading platform BetaCarbon, moved away from a lucrative executive banking role in 2022 as the former treasurer of HSBC Australia.
“I moved into the Web3 space as the carbon credit and environmental markets space was not easily accessible and Web3 provided access to the market,” he said.
I left my engineering job at a TradFi company in 2017 to professionally work in the crypto space. My colleague turned to me when I resigned and said “Remember, quitters never win and winners never quit.” No hard feelings, but I think about your stupid statement often, Steve
— Malcolm (@mxlcolm) February 3, 2022
For Dickinson, the motivation behind the move wasn’t driven by money, but rather by a quest for personal fulfillment.
“It is not more lucrative; it is however far more satisfying,” he said, adding that jobs in traditional finance are not as safe as they once were:
“The banking industry is slowly dying. Constant layoffs and technological efficiencies render many professional service roles at risk. A senior banking official always has a target on his back in the current landscape.”
Simon Dixon, CEO of investment platform BnkToTheFuture, told Cointelegraph he actually attempted to create a traditional bank in 2011 before building a “regulated crypto securities business.”
Dixon said when he did his research into creating a traditional bank, he found out it was actually a massive risk:
“When we applied for a license, the regulators told us we had to store our funds in another fractional reserve bank and that it’s only profitable if we leverage client funds like all banks.”
Later that year, Dixon discovered Bitcoin (BTC) and took an interest in the fact that “funds are owned in self-custody, spent peer to peer and backed by full reserve math and code.”
Related: Investors want crypto, but not without TradFi backing: Nomura survey
TradFi executives have been making their way over to crypto for years now.
According to a Fortune report published in July 2022, two JPMorgan executives, Eric Wragge and Puja Samuel, resigned to pursue a career in the crypto industry.
Wragge, previously a managing director at JPMorgan, made the decision to join Algorand (ALGO) as its head of business development and capital markets.
Samuel, who served as head of ideation and digitalization at JPMorgan, took on the position as head of corporate development at Digital Currency Group.
Magazine: Peter McCormack’s Real Bedford Football Club puts Bitcoin on the map
Claims and noticing agents such as Kroll are often assigned to bankruptcy cases where the number of creditors exceeds a thousand.
Bankrupt crypto exchange FTX has appointed restructuring administration firm Kroll as its agent to track all claims against FTX and ensure interested parties are notified of developments throughout its Chapter 11 bankruptcy case.
Known as the “claims and noticing agent,” Kroll was appointed to the role on Nov. 12 with the news made public on Nov. 17, and aims to compile a database of all claims against FTX Trading and 101 affiliated companies.
Press Release:
— FTX (@FTX_Official) November 17, 2022
FTX Group has established Kroll as its claims agent, and all official documents filed with the U.S. Bankruptcy Court can be found online at https://t.co/7Bsn9Ggckf. pic.twitter.com/OFuCmlJXgJ
At the time of writing, this database lists only eight claims, including one from Singaporean-based blockchain development firm Ethereal Tech for $11.7 million, but will soon be fleshed out as more claims against the group are lodged.
For example, one other case that Kroll has worked on, that of rental car company Hertz, has 62,061 claims against it from its Chapter 11 bankruptcy case.
The eight claims currently included already amount to $40.9 million, though FTX Trading alone is understood to owe customers and investors as much as $8 billion.
Within the filing, the firm has also compiled a list of interested parties it will keep updated on developments, which it acknowledges is incomplete and does not currently include customers.
This list is currently composed of approximately 750 parties who have some kind of interest in the case, with some of the included groups consisting of debtors, banks, landlords, insurance providers, directors, landlords, and regulators.
Some noteworthy names included in the list are National Australia Bank (NAB), Apple, Facebook, JPMorgan, Chainalysis, Wells Fargo, Bank of America, Circle, Stephen Curry, Reddit, and Yuga Labs.
Meanwhile, the number of creditors involved with FTX is thought to be in excess of one million, and corporate securities lawyer Margaret Rosenfeld told Cointelegraph it will take years before any begin to receive any funds back, adding:
“You can’t make creditor distributions until these claims are analyzed. It’s also way too early to speculate on what kind of distribution creditors will get back. Though in mega cases, such as this, full recovery would be unusual.”
Kroll Restructuring Administration is an indirect subsidiary of Kroll LLC, which is one of the world’s largest corporate intelligence companies. Notably, the firm had been employed by Harvey Weinstein on multiple occasions, including when allegations of sexual harassment were brought against him in 2016.
Related: SBF received $1B in personal loans from Alameda: FTX bankruptcy filing
The parent company offers a wide range of services in areas such as environmental, social, and corporate governance (ESG), valuation, compliance, cyber risk, investigations, and corporate finance.
On Nov. 15, regulators in the Bahamas argued that FTX’s new CEO lacks the authority to initiate Chapter 11 proceedings in the United States, with the provisional liquidator overseeing the bankruptcy proceedings of FTX Digital Markets in The Bahamas rejecting the “validity of any purported attempt to place FTX Affiliates in bankruptcy.”
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.
Related: Crypto’s youngest investors hold firm against headwinds — And headlines
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.”
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.
Related: Australian Senators pushing for country to become the next crypto hub
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.
