Cryptocurrencies are considered the new entrants in the field of digital payment settlement systems. The crypto miners and involved individuals with banks, sovereigns and multilateral institutions are evaluating and understanding the dynamics of the crypto sphere in the field.
It is crucial to note that there are underlying issues with cryptocurrencies as well, including terror financing, money laundering etc and this was underlined during the recent meeting at the Australian Blockchain Week on June 26. The meeting discussed various important issues surrounding cryptocurrencies and blockchain.
Sophie Gilder, managing director of blockchain and digital assets at Commonwealth Bank (CBA) underlined the bank’s restrictions on crypto exchange payments, noting it was put in place after seeing an alarming rate of scams that ended up involving cryptocurrency. She further added that one in three of the dollars that are scammed from Australians touch crypto, therefore it is the single largest lever that we have to reduce this impact on our customers.
It is important to note that Australians lost 221.3 million Australian dollars ($148.3 million) from investment scams where cryptocurrency was used as the payment method in 2022, a 162.4% increase from 2021. According to a report from the country’s consumer regulator, the Australian Competition and Consumer Commission (ACCC), 3,910 crypto scam incident reports were made in total, and the average Australian victim was stripped of AU$ 56,600 ($37,900).
Nigel Dobson, banking services portfolio lead at ANZ, referred to data from the Australian Financial Crimes Exchange suggesting that the figure may be even higher, at 40%. It was underlined by Trevor Power, the Australian Treasury assistant secretary that from the government’s point of view, [they] need to invest more in reducing scams, and that’s the government, but it’s also banks, other people in the financial system have to work together to reduce scams to maintain trust in the system.
However, The bank’s decision has continued to meet criticism from Australian crypto exchange customers. Australian lawyer and senior research fellow at the RMIT Blockchain Innovation Hub Aaron Lane has defended the banks’ actions.
