Written By: Ira Rahman| Nov 3, 2021
The Commonwealth Bank has begun allowing its customers to buy and sell cryptocurrency through its app, which is the first move by an Australian central bank. Australia’s largest bank announced they had partnered with US-based crypto exchange Gemini and blockchain analysis firm Chainalysis in offering the service to its 6.5 million app users. The service will allow customers to o buy up to 10 crypto assets, including bitcoin, Ethereum, and Litecoin. The bank is conducting a pilot currently in the next few weeks, which is ahead of wider extended cryptocurrency services launch in 2022. CBA will extend services on the app as time progresses.
Furthermore, through research of their clients, the bank stated that many customers found many had either expressed interest in crypto assets or were already trading crypto through exchanges. According to the Chief Executive of CBA, Matt Comyn states in an interview that, “Customers have expressed concern regarding some of the crypto services in the market today, including the friction of using third party exchanges, the risk of fraud, and the lack of trust in some new providers. Therefore, we see this as an opportunity to bring a trusted and secure experience for our customers.”
Photo credits: Commonwealth Bank has announced it will introduce cryptocurrency trading on its CommBank app. Photograph: Pavlo Gonchar/SOPA Images/REX/Shutterstock
What is the impact on Australia?
As the Commonwealth Bank adopts cryptocurrency services for their customers, it is likely to encourage other big banking to follow their paths. Institutions such as CBA will become the first bank in Australia to support crypto, and according to Blockchain Australia, it is “inevitable” that the other “big four” banks, such as National Australia Bank (NAB), Australia and New Zealand Banking Group (ANZ) and Westpac, will soon follow suit. Several players in the local crypto space in Australia hoped the validation by CBA would see it taking a more open, considered approach to provide financial services to the sector. A recent Senate committee with the Australian government heard in September that debanking is rife across the industry.
Debanking is where financial institutions refuse to offer services to businesses in Australia.
Tristan Dakin, Australian country manager at Wise, further states, “If CBA is willing to offer unregulated products like crypto within their risk appetite, it raises questions around the debanking and restricting of banking services to regulated financial institutions in Australia, citing little more than ‘risk concerns. Having this coming from a systemic and the biggest bank in Australia, it’s a move that will change a lot,” he said. CBA offering cryptocurrency trading their app will encourage other banks in the area to follow suit and encourage more investors and regulations in the region.
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Gkritsi, E. “Commonwealth Bank First in Australia to offer Crypto Services.” CoinDesk; CoinDesk. 3 Nov. 2021. https://www.coindesk.com/business/2021/11/03/commonwealth-bank-first-in-australia-to-offer-crypto-services/
Sier, J., & Eyers, J. “CBA Drives Stake in Crypto Ground for Banks.” Australian Financial Review; AFR, 3 Nov. 2021. https://www.afr.com/companies/financial-services/cba-crypto-move-will-shake-up-the-industry-20211103-p595kg
Taylor, J. “Commonwealth Bank to offer Cryptocurrency Trading in First for Australia’s Big Four.” The Guardian; The Guardian, 3 Nov. 2021. , https://www.theguardian.com/australia-news/2021/nov/03/commonwealth-bank-to-offer-cryptocurrency-trading-in-first-for-australias-big-four