Australia’s CBA blocks payments to crypto exchanges

abdelaziz Fathi

Australia’s largest bank, the Commonwealth Bank of Australia (CBA), has introduced new anti-scam measures that include blocking certain payments to specific cryptocurrency exchanges.

As part of these measures, from Thursday onwards, the bank will hold specific payments to crypto exchanges for a period of 24 hours. Furthermore, the CBA plans to apply a monthly transfer limit of A$10,000 (US$6,666) to crypto exchanges. However, the spokesperson for the lender didn’t provide clarification on whether these measures will be applicable to all crypto exchanges or only a limited number of them.

“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,” James Roberts, Commonwealth’s general manager of fraud management, said.

The move follows Westpac’s decision last month to ban customers from transferring funds to Binance, citing its efforts to reduce losses from scams. The Australian big four bank said the move comes after its internal data revealed that investment scams constituted approximately half of all scam losses, with one-third of scam payments being directly transferred to cryptocurrency exchanges.

“Digital exchanges have a legitimate role to play in the financial ecosystem. But since the rise of digital currency, we’ve noticed that scammers are increasingly using overseas exchanges. Often our customers only discover they’ve been scammed after the money has left the country, making recovery extremely difficult,” the bank said.

As a result, the Australian arm of Binance told its customers that it will be unable to deposit or withdraw Australian dollars (AUD) using bank transfers. The suspension was initially announced on May 18, but the exchange resumed withdrawals via bank transactions for Australian users until June 1.

Binance Australia has suspended all trading pairs involving the Aussie. In order to facilitate withdrawal and trading operations, users can convert their AUD balance into stablecoin USDT.

Meanwhile, Binance Australia said that it was working hard to find an alternative provider to continue offering AUD deposits and withdrawals. The company also noted that credit and debit card purchases were still operational in its peer-to-peer marketplace.

The exchange also assured clients that their funds are secure through the Secure Asset Fund for Users (SAFU). This insurance fund is designed to provide protection to Binance users and their funds in the rare occurrence of extreme situations.

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