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Australian Bank Limits Transfers to Crypto Exchanges

Commonwealth Bank (CBA), the largest bank in Australia, would decline or put “certain payments to cryptocurrency exchanges” on a 24-hour hold, and limit crypto transfers

Australian bank limits transfers to crypto exchanges

Without detailed explanations, Commonwealth Bank (CBA) announced it would decline or temporarily hold certain payments to “high-risk” cryptocurrency exchanges. In addition, the institution will add a $6,650 ($10,000 Australian dollar) per month limit for customers sending funds to crypto exchanges in the coming months.

The main reason quoted by the bank is the need to combat crypto-related scams, which reportedly cost $700k per day to CBA customers.

James Roberts, Commonwealth Bank General Manager of Group Fraud Management Services, said: “Consumer interest in cryptocurrencies has been increasing and unfortunately scammers globally are capitalising on this trend and masquerading as legitimate investment opportunities or diverting funds into cryptocurrency exchanges.”

The move comes just in time when two major global exchanges – Binance and Coinbase – are facing lawsuits from the United States securities regulator SEC for trading unregistered securities and misleading consumers.

To help protect customers from scam risks associated with crypto purchases, CBA will hold certain payments for 24 hours, and decline some transactions altogether. It expects holds, declines and limits applied to outbound payments to cryptocurrency exchanges will help reduce both the number of scams and the amount of money lost. The bank didn’t explicitly state which exchanges or payment types would be more or less impacted by the new measures.

At the same time, the organization said the measure would be “subject to ongoing review” as it would monitor the impact of the newly-introduced measures on illegitimate crypto transfers.

Earlier this spring, the Commonwealth Bank of Australia started exploring a Scam Indicator solution able to protect its joint with Telstra clients from phone scams and mitigate customer losses of up to $15-20 million.

Nina Bobro

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Nina is passionate about financial technologies and environmental issues, reporting on the industry news and the most exciting projects that build their offerings around the intersection of fintech and sustainability.