Commonwealth Bank Limits Crypto Payments as US-Led Crackdown Spreads

Commonwealth Bank has limited transfers to high-risk crypto exchanges, just days after US regulators launched legal action against the world's two largest exchanges, Dubai-based Binance and Nasdaq-listed Coinbase.

Australia's largest bank rolled out a series of fraud protection measures on Thursday, following Westpac in restricting customers from converting Australian dollars to crypto assets at the behest of scammers.

"Our ability to recover money from crypto exchanges is incredibly difficult," said James Roberts, general manager of group fraud management services at CBA.

"We can usually ask other Australian banks to preserve fraudulent money, but when it hops across crypto wallets all around the world instantly, the recovery rate is very low."

In addition to some outright bans, CBA will impose a 24-hour transaction hold for customers wanting to transfer money to any crypto exchanges, as well as a $10,000 monthly limit.

"We recognise there will be an impact on some people, but the scale of investment scams involving crypto exchanges is so large we have to take assertive measures," Mr Roberts said.

About $700,000 of scammed money flows out of CBA accounts every day to crypto exchanges, as customers succumb to a growing number of financial frauds touted as crypto investment opportunities.

CBA paused its own in-app cryptocurrency trading launch last year, when digital asset markets underwent a broad-based sell-off and uncertainty swelled around exchange liquidity. The bank previously said it would allow customers to buy and sell cryptocurrency through its app, but stopped the pilot without announcing a new timetable.

(Source: Financial Review)