Financial regulators are hampering the expansion of the cryptocurrency services of the Commonwealth Bank of Australia (CBA) mobile app. In an Australian first, the bank intends to grant all of its 6.5 million users access to cryptocurrency services.
CBA Cryptocurrency Products began a pilot of the services late last year, after which it hoped to open it up to all users of its app. However, now it seems to be starting a second pilot. The Australia Financial Review (AFR) newspaper reported on Wednesday that the Australian Securities and Investments Commission (ASIC) has hampered the launch with red tape.
ASIC opposes the launch for consumer protection in terms of target market and product information. The CBA has been working with ASIC and other Australian government regulators to launch the services.
Speaking Wednesday at the Australian Financial Review Cryptocurrency Summit, ASIC Commissioner Cathie Armour explained her commission’s recent interest in cryptocurrencies, despite arguments that they are not ASIC’s purview. He said that while crypto assets are not necessarily financial products that the commission can regulate, he was concerned that:
“Consumers may be investing in an environment where they are not offered the same level of protection that applies to financial products and services.”
Fighting against new ASIC guidelines that ban much of the work of financial influencers, Senator Andrew Bragg stated that the application of the ASIC rules for financial products cannot be applied to crypto assets because cryptocurrencies are not a financial product under Australian law.
In his speech, Armor commented that ASIC’s ability to actually regulate crypto assets “depends on whether they fit into the legal framework for financial products and services,” which she said is “a matter for Parliament.”
Armor added that he sees “real benefits of innovation within our regulatory regime“, but warned that:
“There are a lot of rules that you have to follow.”
The announcement of the CBA’s intention to launch cryptocurrency services created a stir last November as it was the first of the “big four” banks in the country to do so. Blockchain Australia CEO Steve Vallas told Cointelegraph that the move would be “extraordinarily important.”
To bring the product to life, the CBA partnered with offshore cryptocurrency exchange Gemini and blockchain analytics firm Chainalysis. Once fully launched, the product will include Bitcoin (BTC), Ether (ETH), Bitcoin Cash (BCH), and Litecoin (LTC).
Investments in crypto assets are not regulated. They may not be suitable for retail investors and the full amount invested may be lost. The services or products offered are not aimed at or accessible to investors in Spain.