Executives at two of Australia’s “big four” banks have ruled out allowing retail customers to trade cryptocurrency on their platforms, with one reasoning that customers don’t understand “basic financial well-being.”
Speaking at the Australian Financial Review Banking Summit on May 31 Maile Carnegie, executive for retail banking at Australia and New Zealand Banking Group (ANZ) said that from speaking to retail customers she believed “the vast majority of them don’t understand really basic financial well-being concepts.”
“Are we really going to make it easier and less friction and implicitly endorse speculating on crypto when they don’t understand basic financial well-being? The answer was no.”
Carnegie said ANZ had considered a cryptocurrency product from as early as 2017 adding she was “happy we didn’t go head long” into the offering.
Also attending the summit was chief digital officer for National Australia Bank (NAB) Angela Mentis who was asked if NAB would consider offering crypto trading. She answered “not in the foreseeable future and not for retail” but added there are already applications for blockchain technology for institutional clients.
In March ANZ became the first bank in Australia to mint an Australia dollar (AUD) pegged stablecoin called A$DC and NAB is also gearing up to launch its own stablecoin which is expected to be operational by the end of 2022.
Both stablecoin projects from the big banks will initially be offered for institutional clients seeking an on-ramp for crypto investments, the pilot transaction of A$DC for exampl was a $30 million AUD transfer.
The only big four bank with plans to launch a retail crypto trading product is the Commonwealth Bank of Australia (CBA). At the summit its CEO Matt Comyn said despite facing challenges it was still its “intent” to launch the service.
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CBA revealed plans to enable crypto trading in November 2021 by partnering with the Gemini crypto exchange and limited trials began soon after. But in April news emerged that the Australian Securities and Investment Commission (ASIC) had tied up the launch with regulatory red tape citing concerns of consumer protections and the CBA started to plan a second pilot of the product.
In late May, CBA put its plans for the second pilot on hold indefinitely and cut off crypto trading to those in the first round of testing with Comyn saying at the time the bank was still waiting on regulatory clarity.
At the summit Comyn added that if it were to proceed with the offering the bank would look to restrict trading to those “who understand the risky asset class.”
Hitting back at the comments from the banking executives, Ian Love the founder and CEO of crypto investment firm Blockchain Assets tweeted:
“How will we ever reduce wealth inequality when our regulatory system has financial discrimination at it's core? It's time to remove the 'Sophisticated Investor' discrimination rules that advisors use to hide behind and allow everyone access to financial advice and services.”