Australia’s Largest Banks Plans to Hold and Decline Payments to Crypto Exchanges
Australia’s largest bank - Commonwealth Bank (CBA) - announced that it will hold and also decline certain payments to local cryptocurrency exchanges while citing the risks of scammers.
This development comes just within days of the US SEC filing lawsuits on two of the world’s biggest crypto exchanges such as Binance and Coinbase. Commonwealth is not the first Australian bank to block transactions from crypto exchanges.
Even before the SEC lawsuit, Australian bank Westpac banned customers from transacting with crypto exchange Binance. This happened as the Australian Securities and Investments Commission (ASIC) canceled the derivatives license of Binance Australia in April 2023. Last month, Binance had to suspend all AUD deposits on the platform leading to major withdrawals.
In their latest announcement on Thursday, June 8, the Commonwealth Bank (CBA) said that they would be declining or putting a 24-hour hold on “certain payments to cryptocurrency exchanges”.
James Roberts, Commonwealth Bank General Manager of Group Fraud Management Services, said: “Consumer interest in cryptocurrencies has been increasing and unfortunately scammers globally are capitalizing on this trend and masquerading as legitimate investment opportunities or diverting funds into cryptocurrency exchanges”.
“With the incidences of scams increasing and in many cases customers suffering significant losses from being scammed, the introduction of 24 hour holds, declines and limits on outbound payments to cryptocurrency exchanges will help reduce both the number of scams and the amount of money lost by customers,” he added.
CBA will continue to closely monitor the impacts of these scam response measures and review them regularly. In related articles, new initiatives are being implemented to detect, prevent, and educate customers about scams.
CBA and Telstra have joined forces to protect customers from phone scams, recognizing the need for a comprehensive approach to tackle scams across the ecosystem.
Customers who make payments to cryptocurrency exchanges face a higher risk of being scammed, despite these measures being implemented. However, these initiatives are part of a broader range of efforts to help customers minimize the risk of falling victim to scams, according to Mr. Roberts.
This is a major turnaround for Commonwealth Bank (CBA) which was planning to launch its own crypto trading service for millions of users via the CommBank app, back in November 2021.