CBA puts banks ahead of tech in crypto race
CBA puts banks ahead of tech in crypto race - Financial Review, 11/4/2021
James Eyers and Jessica Sier Commonwealth Bank CEO Matt Comyn has put a stake in the ground for mainstream banks rather…
On November 4, CBA announced that its banking app would let its 6.5 million users buy and sell ten different digital coins. This high-quality and secure offering by CBA is with partnering with Gemini, a US-based exchange, and Chainalysis, which works with US law enforcement on compliance and monitoring. CBA said banks must play a central role in digital asset markets. Its move is a response to the growing customers’ interest in and adoption of cryptocurrencies, especially in segments like Millennials, tech-savvy and finance professionals.
Financial regulators and policymakers welcome CBA’s move, the further mainstreaming of cryptocurrency. However, while they proposed a new regulatory regime for the crypto economy, the Senate committee said the council of financial regulators should clarify the due diligence standards on start-ups for the regulated banks.
Industry players and observers said CBA’s surprise move validated the volatile sector with a clear signal of regulatory certainty to operate. Bitcoin evolves from a store of value or form of digital gold to fiat currencies with money-like functions. However, Some local crypto exchanges may see this opportunity creates competitive tensions. Some of CBA’s competitors, which hoped the crypto would be out of existence with more regulation, may be at risk of bleeding young customers to CBA. This year, both Visa and Mastercard have announced their plan to extend into crypto.