Australian Watchdogs to Check CBAs Crypto Offering Regulatory Implications

Australian Watchdogs to Check CBAs Crypto Offering Regulatory Implications

A partnership with Gemini Trust Company is initially planned for CBA's cryptocurrency trading service.

The Australian banking regulator is looking at the implications of Commonwealth Banks planned introduction of Bitcoin (BTC) trading to retail investors in terms of regulatory affairs. According to Reuters, the bank will become the first one to do so in the country.

Concerns are related to a lack of regulatory framework for cryptocurrencies in Australia, as these assets are not formally regulated in the country. CBA announced this week that it planned to introduce crypto services to retail customers in a maneuver that encourages regulators to assess the crypto market. The Australian Prudential Regulation Authority (APRA) is already aware of the plans and told Reuters that it is looking at the ‘regulatory issues’ it might bring to the table.

Initial plans said that CBA‘s crypto trading service would be provided in partnership with Gemini Trust Company, which is one of the biggest cryptocurrency exchanges founded by the millionaires, the Winklevoss twins. “We would really welcome regulatory clarity for crypto assets. We think it would improve the market, enhance trust, and it would raise the bar in terms of customer protection,” Sophie Gilder, Commonwealth Bank’s head of Blockchain and the banks project leader, commented on the announcement.

Monitoring Anti-Money Laundering Potential Transactions

Gilder also clarified that the bank is already aware of anti-money laundering potential issues through cryptocurrencies, and that‘s why CBA will monitor any suspicious activities with Chainalysis, a blockchain analytics firm. “We’ve got complete transparency as to customer activity and can report on that to regulators when necessary. We will not, as soon as the pilot ends, open it to everyone. It will be a more gradual process than that, which I think is appropriate considering the volatility of crypto,” she added.

The decision to introduce these new services was made as a large number of its customers want to access crypto assets as an investment class. This step by the bank will bring crypto to its 6.4 million customers.