Australian Banks Don’t Like Bitcoin

Banks in Australia have mixed feelings about Bitcoin and its related services. On September 21, 2015, Banks in the region sent letters to Australian Bitcoin exchanges letting them know their accounts will cease with no explanation to why. According to the The Australian Financial Review, 17 native Bitcoin businesses have received letters, with 13 of them having their accounts terminated.

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“Should bitcoin companies be shut out of the Australian marketplace because of de-banking actions, this question will forever remain a hypothetical.”

Ronald Tucker, Managing Director & Business Development Bit Trade

There has been no information regarding why the Banks have taken these actions. The managing director of Bit Trade, an Australian exchange, said, “Our members have been unable to obtain any formal clarification on the reasons for closure, except for references to policy or risk. Just what policies or risks these are have not been specified,” Meanwhile, most of the companies are willing to discuss the matter, however, they say no one has “been given the opportunity.”

bit-trade-australia-logoBack in April of 2014, a local Australian trader received notification that the National Australia Bank would stop providing business to Bitcoin operators, closing accounts in May of 2014. This current news shows the letters came from Westpac Banking Corporation and the Commonwealth Bank of Australia. However, Bit Trade’s Tucker says that, “all large Australian banks were shutting the door on bitcoin companies.”

Australian venture businesses and politicians believe these closures will deeply affect the Bitcoin industry looking to shake up the current banking sector. Australian Senator Sam Dastyari said he was “concerned” for the startups in Australia stating:  

“I am concerned that there is an allegation that Australian banks are deliberately choking small businesses, while setting themselves up to offer the same services,” he said. “We don’t have a four-pillars policy to allow banks to guillotine emerging industries they are competing with … These small local digital currency companies are essentially competing to provide trading platforms, and develop emerging technologies.”

Sam Dastyari,  New South Wales Senator

shutterstock_270646241-e1429540417261Westpac and other banks did not disclose an explanation for why each account was closed. Overall, though, the banks alluded to the regulatory issues concerning the currency. Mainly anti-money laundering and counter-terrorism financing (AML/CTF) laws have been mentioned by Australian banking officials. Acting chief executive of the Australian Bankers’ Association Tony Pearson told the Financial Review that, “lack of transparency and regulatory oversight raised a number of risks for users and also posed risks for the payments system.”

With these concerns, Pearson said that Australian banks will continue to monitor the “developments in bitcoin, including their regulation.” It seems Australian banks are fighting back because they are feeling threatened by disruption. The global financial cartels certainly don’t know what to do about the virtual currency. What they do know is that they have the power to make things difficult for innovation.

What do you think of Australian Banks closing Bitcoin services accounts? Let us know in the comments below!


 

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