Category: Australia

Categories
Australia Swyftx

Aussie Exchange Launches World’s First Crypto Transfer Service

Australian crypto exchange Swyftx has launched a portfolio transfer service to make it easier and safer for crypto users at competitor exchanges to move their assets.

The Brisbane-based business said the new service would allow crypto holders to transfer multiple crypto tokens in a single transaction for the first time. Crypto users currently are required to transfer individual assets one by one if they wish to switch platforms.

Chief Operating Officer at Swyftx, Jason Titman, said:

“We’ve seen an uptick in crypto users who want to move their assets to Aussie-owned and regulated platforms in response to FTX, as well as other recent regulatory enforcements.

“We expect crypto switching services to become an industry norm over the next five years as competition hots up. Even if exchanges don’t build them now, it’s likely that eventually they’ll be mandated by competition regulators. Just as we’ve seen in areas like bank account switching and mobile phone transferability between telcos.”

Swyftx Chief Operating Officer Jason Titman

The portfolio transfer feature will initially allow Australian customers at just two exchanges – Binance and Coinspot – to transfer their crypto portfolios across to Swyftx without any fees. Over the next few weeks, the service is expected to be expanded to include local customers at other global exchanges and smaller domestic competitors.

The portfolio transfer service works by using pre-existing APIs to transfer assets across the blockchain from one exchange to another. Swyftx said that the API data would not be stored or managed by the exchange.

Titman said the new service would reduce the risk of people losing crypto by inputting incorrect wallet addresses. It will also mean customers no longer have to transfer crypto one asset at a time.

Categories
Australia Binance Australia Crypto Exchange Crypto News

Aussies Transfer to Local Exchanges as Binance Suspends AUD Fiat Services 

Aussie crypto exchanges have reported a big increase in new customers following Binance Australia’s suspension of AUD fiat services.

On May 18, Binance Australia told customers that its Aussie dollar services were suspended “due to a decision made by our third-party payment provider”. Meanwhile, the Australian Financial Review reported that Westpac had stopped its customers from transacting with Binance amid concerns over the use of overseas exchanges by scammers.

National exchanges have since reported a significant increase in traffic and downloads across their platforms.

Aussie crypto users move to local exchanges

Jason Titman, chief operating officer at Australian-owned exchange Swyftx, said:

“We’ve just seen a seven-month high in the number of new customer registrations. Aussie crypto users want the peace of mind that comes from dealing with a secure, large national exchange at the moment.”

Binance Australia has told its customers that they can continue to withdraw AUD via bank transfer until June 1. In its latest update, the exchange also said it was “working hard to find an alternative provider to continue offering AUD deposits and withdrawals.”

In a media statement on May 18, Westpac Group Executive of Customer Services and Technology, Scott Collary, said: “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.”

New research reveals Aussie crypto users biggest consideration when choosing an exchange

Titman said new Swyftx customer research had shown Australian ownership was now the biggest consideration for local crypto users when choosing an exchange.

“There has been a major shift in sentiment over the last six months and especially since the collapse of FTX, with local crypto users opting for local crypto exchanges.”

“Australians want to trade on secure exchanges that are based in the country and operate to local standards.”

“Swyftx has one of the largest teams in the country and we work closely behind the scenes with banks and law enforcement to keep our customers safe, with around 15% of our team dedicated to security and scam prevention.”

Categories
Australia Bitcoin Independent Reserve Investing Surveys

Bitcoin Dominates Brand Awareness as Voted by Aussies

Bitcoin (BTC) is far and away the most well known cryptocurrency, with over 90 percent of Australians having heard of the OG crypto, according to a 2022 survey by Australian cryptocurrency exchange Independent Reserve.

The Independent Reserve Cryptocurrency Index (IRCI) is an annual cross-sectional survey of the attitudes of 2,000 Australians towards cryptocurrency and is designed to reflect the age, gender and demographics of the broader Australian population.

Aussies Consider Bitcoin an Investment

This year’s IRCI found that more Aussies than ever before consider Bitcoin an investment asset, at just under 30 percent. This rise coincides with a downward trend since 2019 in the number of people who consider Bitcoin a form of money, a scam, or had simply not thought about it enough to answer.

The survey also found that plenty of Aussies knew about crypto other than Bitcoin, with 42.9 percent having heard of Ethereum, 35.8 percent aware of Dogecoin, and 15.1 percent familiar with XRP.

Bitcoin and Ethereum are the most well-known cryptocurrencies in Australia. Image source: Independent Reserve

Short-Term Sentiment Falls

While awareness of crypto is high, sentiment has fallen compared to last year’s survey, with Independent Reserve’s overall index dropping from 54 to 45. According to Independent Reserve, a score of 100 would “indicate complete awareness, optimism, trust and adoption” while 0 would indicate the opposite.

Independent Reserve said a more negative sentiment in 2022 reflected lower crypto ownership rates and a fall in short term confidence in crypto. Despite this drop in sentiment since 2021, overall ownership rates remain up in 2020. 

The steepest drop in crypto ownership occurred in the 18-24 age group where it dropped from 56 percent in 2021 to just 33.3 percent this year. In other age groups, ownership rates actually held steady or grew.

Long Confidence Remains Strong

Despite the drop in short-term sentiment, the survey found Aussie’s longer term confidence in crypto remains strong:

  • Only eight percent of respondents said they plan to get out of crypto entirely;
  • 44 percent said they plan to increase or diversify their crypto holdings;
  • 45 percent said they would hold.

When asked what they thought Bitcoin’s price would be in 2030, the most popular response from both crypto owners and non-owners was between $30,000 and $100,000, indicating many believe Bitcoin’s value will grow considerably from where it sits today.

The prospect of crypto eventually being widely accepted by people and businesses was highly correlated with age, with all age groups under 44 strongly believing it was likely. People aged between 45 and 54 years old were fairly evenly split between likely and unlikely, while those over 54 considered it unlikely.

Categories
Australia DeFi Illegal Regulation

ASIC Sues Aussie Fintech Company Block Earner Alleging Unlicensed Services

Australia’s financial markets watchdog is taking Aussie crypto platform Block Earner to court for allegedly providing unlicensed financial services and running an unregistered managed investment scheme. 

The Australian Securities and Investments Commission (ASIC) announced Wednesday November 23 that it had commenced civil penalty proceedings against Block Earner — the trading name for Web3 Ventures — in the Federal Court.

“We are concerned that Block Earner offered financial products without appropriate registration or an Australian Financial Services licence, leaving consumers without important protections. Simply because a product hinges on a crypto-asset, does not mean it falls outside financial services law.”

ASIC Deputy Chair Sarah Court

ASIC has been active when it comes to enforcement in the crypto space of late, taking legal action against the company being the Qoin token in October this year.  

Block Earner CEO Cites Lack of Regulatory Clarity

Bringing decentralised finance to the masses has been the catch-cry of Block Earner, which offers a range of fixed annual yield products backed by crypto, USD reserves and physical gold. ASIC said Block Earner’s crypto-asset-related offerings were financial products, which comes with a requirement to hold an AFS licence — which Block Earner does not have.

Speaking to Business News Australia, Block Earner co-founder and CEO Charlie Karaboga described the legal action as a “disappointing outcome”. He said the startup had invested in infrastructure to be able to operate compliantly and protect its customers against crypto market volatility. 

“Needless to say, lack of clarity around regulation in Australia for cryptocurrency-related products creates friction between regulators and innovators like Block Earner in our industry. In an ideal world, we would build these products in a regulatory sandbox with more clarity around licensing regimes. In the future, we look forward to working with ASIC and other regulators in this space to make Australia an innovative space for the crypto industry.”

Block Earner co-founder and CEO Charlie Karaboga

ASIC Supports Regulation to Protect Consumers

ASIC said it supports the development of an effective regulatory framework covering crypto assets in order to protect Australian investors — who have demonstrated a strong interest in crypto. 

Research released by ASIC in August 2022 found many new, young investors had become active in financial markets and 44 percent reported holding crypto. Just 20 percent of crypto owners considered their investment approach to be ‘risk-taking’, and many said they sourced information from social media, podcasts and financial influencers.

In its statement about legal proceedings against Block Earner, ASIC highlighted its concerns about consumers’ vulnerability in their rush to embrace crypto:

“Crypto-assets are risky, inherently volatile and complex and ASIC remains concerned that potential investors in crypto-assets may not fully appreciate the risks involved. ASIC supports the development of an effective regulatory framework covering crypto-assets to protect consumers and investors.” 

ASIC Deputy Chair Sarah Court
Categories
Australia Crypto Memes Payments Shiba Inu

Fully Integrated SHIB Restaurant Set to Open in Australia

Touted as ‘Australia’s first #cryptoDINER’, a Shiba Inu themed restaurant called Shiba Wings is set to open on the Gold Coast and will accept crypto payments in exchange for its menu of hot wings, burgers and beers.

A tweet and video by Australian-based SHIB crypto enthusiast SHIB Planet revealed the new restaurant would use the NowPayments platform to accept cryptocurrency as payment. He also suggested the owners were open to future integration with Shibarium — the layer 2 upgrade to improve the scalability of SHIB on the Ethereum blockchain.

Shiba Inu (SHIB) is considered a ‘meme coin’ — tokens inspired by popular culture and internet jokes— and was created on the back of the success of Dogecoin. Although it seems much of its appeal comes simply from the cute imagery of the Shiba Inu dog breed, SHIB is currently ranked 13 in market value by CoinMarketCap.

Shiba Wings ‘Coming Soon’ to Surfers Paradise

According to Shiba Wings’ social media, the diner will open “soon” and will be located on Cavill Avenue in the Gold Coast suburb of Surfers Paradise. A number of mock-ups of the restaurant’s decor shared online show prominent Shiba Inu and Bitcoin imagery and a market ticker displaying crypto prices. 

Mock-up of the inside of the new Shiba Wings store. Source: Shiba Wings Facebook

Other Shiba Inu branded food ventures have been launched around the world including burger joints in Italy and a ‘Shiba food park’ in Venezuela. 

Categories
ASX Australia Blockchain Crypto News Regulation

ASX Scraps $250 Million Blockchain-Based CHESS Project

The Australian Securities Exchange (ASX) announced Thursday morning that it would scrap the blockchain-based replacement for its ageing Clearing House Electronic Subregister System (CHESS) settlement and clearing system. The blockchain-based system had been in development for seven years and had already cost ASX in the order of A$250 million.

The new system had originally been scheduled to launch in 2021 but was delayed several times due to ongoing issues throughout its development.

ASX’s use of blockchain had been seen globally as a significant milestone in the adoption of the emerging technology, however, today’s announcement now marks a further blow to mainstream confidence in blockchain, coming on hot on the heels of the calamitous collapse of FTX last week.

Blockchain-based Replacement Abandoned After Scathing Report

The decision to scrap the blockchain-based system comes after a scathing report from Accenture found it wouldn’t be up to the task of replacing the existing CHESS.

The report, which was commissioned in August of this year, found that the software to run the new system was only 63 percent complete, despite having been in development since 2015. 

Commenting on the findings of the report, ASX Chairman Damian Roche told the Australian Financial Review: 

“The path we were on will not meet ASX’s and the market’s high standards. There are significant technology, governance and delivery challenges that must be addressed…On behalf of ASX, I apologise for the disruption experienced in relation to the CHESS replacement project over a number of years.”

Damian Roche, ASX Chairman

Setback for Australian Financial Infrastructure

The new blockchain-based system was to form a crucial part of Australia’s financial infrastructure. Its abandonment is a significant setback, and means Australian investors will be relying on the now 25-year old CHESS system for the foreseeable future.

Speaking on the abandonment of the new system, Governor of the RBA, Phillip Lowe said:

“The announcement by ASX after many years of investment by both ASX and industry is very disappointing. ASX needs to prioritise developing a new plan to deliver safe and reliable clearing and settlement infrastructure.”  

Philip Lowe, RBA Governor

Back to Square One

ASX will now start over again looking for solutions to replace the CHESS system. ASX CEO, Helen Lofthouse said the search for new solutions will be conducted with an open mind, insisting it’s possible the new system may utilise some elements of the abandoned system, including using blockchain or some other distributed ledger technology (DLT):

“To be clear, the derecognition charge reflects the uncertainty of the future value of the current solution design. It does not prevent us from using parts of what we have already built if we determine there are adjustments we could make to our current design, which will enable it to meet ASX’s and the market’s high standards.”

Helen Lofthouse, ASX CEO

Former Westpac executive, Tim Whiteley, has been appointed by ASX to oversee the new search for a replacement for its CHESS system.

ASX says that until a suitable replacement is developed and rolled out it will continue to invest in and maintain the existing CHESS system.

Categories
Australia Cryptocurrency Tax Investing Regulation

Australia 2022 Budget Continues Capital Gains Tax on Crypto Assets

Capital gains tax will continue to apply to Aussie’s crypto investments, as confirmed by an explicit mention of digital currencies in the federal budget released on Tuesday October 25.

The budget papers 2022-23 state that legislation will be introduced to clarify that crypto won’t be treated as foreign currency for tax purposes. The incoming legislation will be backdated to income years that include 1 July 2021.

It confirms the continuation of current practices whereby investors must track, calculate and declare any capital gain or loss made on digital assets in their tax returns.

However, the budget specified the rules are different for government-issued digital currencies: “The exclusion does not apply to digital currencies issued by, or under the authority of, a government agency, which continue to be taxed as foreign currency.” 

Certainty for Investors, No Impact on Coffers

Although the mention of digital currency taxation is just one small section in a document of more than 200 pages — with no expected impact on government coffers — calling out crypto in the budget signifies the rising relevance of digital assets in financial markets. 

It reinforces a statement issued in June, not long after the Albanese Government took power, that said cryptocurrencies held as investments would be excluded from foreign currency tax arrangements — to reduce uncertainty in the wake of a decision by El Salvador to allow Bitcoin as legal tender.

In that earlier statement, Assistant Treasurer Stephen Jones said maintaining a capital gains tax approach to crypto investments, “…gives certainty and clarity at a time of volatility for crypto currencies.”

“The Government will continue to take a pragmatic and timely approach to its role in the rapidly-evolving digital currency landscape.”

Assistant Treasurer Stephen Jones

Understanding Your Crypto Tax Obligations

Most Australians who treat crypto as a personal investment, with the hope of making long-term gains, are considered investors and therefore subject to capital gains tax on the gains or losses they make on their digital assets. 

It’s important for investors to be able to assess all of their trades throughout the year so they can stay on the right side of the tax collector. Fortunately, there are some great free guides and calculators to help you manage your tax return. 

Categories
Australia Crypto News Illegal Regulation

ASIC Sues Financial Firm Over Aussie Crypto Token ‘Qoin’

The Aussie company behind the controversial crypto token Qoin is being sued by the Australian Securities and Investments Commission (ASIC), alleging its marketing included false, misleading and deceptive claims about how investors could use the tokens.

ASIC’s civil court legal action against BPS Financial Limited — the company that launched Qoin in late 2019 — also alleges unlicensed conduct and that BPS falsely conveyed that the company and its wallet app were regulated and legally compliant.

In a statement issued on Tuesday October 25, ASIC Deputy Chair Sarah Court said:

“ASIC is particularly concerned about the alleged misrepresentation that the Qoin Facility is regulated in Australia, as we believe the more than 79,000 individuals and entities who have been issued with the Qoin Facility may have believed that it was compliant with financial services laws, when ASIC considers it was not.”

ASIC Deputy Chair Sarah Court

An announcement on the Qoin website states that BPS is reviewing the allegations, does not agree with ASIC’s position, and will be defending the matter. 

Limits on Exchanging Tokens Raises Concern for Consumers

The idea behind Qoin tokens is that they can be used by consumers as a digital currency within a large ecosystem of participating businesses, to enable secure and contactless payments — upon its launch, BPS claimed to have more than 35,000 merchants signed up. 

BPS also marketed that Qoin tokens could be swapped for crypto and Australian dollars, via Block Trade Exchange Limited, aka the BTX Exchange, which is linked to BPS and has the same directors.

Early critics argued this closed system reduced the token’s utility and created a potential conflict of interest. Frustrated investors have long been complaining about difficulties in selling Qoin.

Core allegations being made by ASIC related to the current civil court action include that BPS falsely assured investors that they could exchange their Qoin tokens for other crypto assets or fiat currency, and that they could use Qoin tokens to purchase goods and services from a growing number of merchants. 

“We allege that, despite what BPS represented in its marketing, Qoin merchant numbers have been declining, and that there have been periods of time where it was not possible to exchange Qoin tokens through independent exchanges.”

ASIC Deputy Chair Sarah Court

ASIC is seeking declarations, pecuniary penalties, injunctions and adverse publicity orders from the Court.

Coin’s Chequered Crypto Journey

In its short history, the Qoin token has been embroiled in controversies including: 

Categories
Australia Crime Crypto.com Illegal

Melbourne Couple to Face Trial Over $10.4M Crypto.com Blunder

crypto.com

A Melbourne couple who spent most of a A$10.4 million refund they received in error from cryptocurrency exchange Crypto.com are set to face trial. An administrative mistake made by an employee in Bulgaria saw the couple receive the huge sum instead of what should have been a A$100 refund.

Jatinder Singh, 37, and his partner, Thevamanogari Manivel, 40, appeared in Melbourne Magistrate’s Court on October 11 to hear the charges against them. 

At the hearing, Singh pleaded not guilty to theft and dealing with property that is the suspected proceeds of crime while Manivel pleaded not guilty to negligently dealing with property that is the suspected proceeds of crime. 

Employee Blunder Turns $100 Into $10.4M

The error which led to the couple’s unintended windfall occurred on May 12, 2021 when a Crypto.com employee based in Bulgaria was processing a refund. Rather than entering the correct cash amount of A$100 in the ‘amount’ field, the employee inadvertently entered an account number. This simple mistake resulted in over A$10 million being deposited into Manivel’s Commonwealth Bank account.

Upon receiving the enormous payment, Singh claims he thought he had won a competition run by Crypto.com after supposedly receiving a notification from the Crypto.com app. However, Crypto.com claims there was no competition that involved a $10 million prize at the time, and even if there were, the company doesn’t notify winners of competitions through in-app notifications.

Couple Bought Up Big Time

After receiving the erroneous refund, the court was told Manivel bought four houses, numerous vehicles, furniture and art. The court was also told A$4 million was transferred to a bank account in Manivel’s home country of Malaysia.

Crypto.com was unaware of the mistake until it was revealed in an audit of the company’s finances in December 2021, around six months after it occurred.

Despite Attempt to Flee, Couple Couldn’t Escape the Fallout

Manivel was arrested in March of this year at Melbourne airport with a one-way ticket to Malaysia, in what prosecutors say was an attempt to flee the country.

Both Manivel and Singh have been committed to stand trial at a later date, Manivel was released on bail while Singh remains in custody awaiting trial.

Crypto.com is also pursuing civil action against the couple in an attempt to recover almost A$3 million dollars which is yet to be paid back.

Categories
Australia Crypto Wallets Cryptocurrency Law Cryptocurrency Tax Gaming

Northern Territory Moves to Regulate Crypto Gambling

Cryptocurrency is about to join crocs and Kakadu as one of the three defining features of Australia’s Northern Territory, with plans afoot to include crypto betting as part of the Top End’s regulated gambling industry.

The Australian Northern Territory Racing Commission (NTRC) is seeking input and feedback from gambling licensees on how the regulatory landscape might change in order to get crypto betting off the ground in the NT.

With gambling in Australia regulated by states and territories rather than at federal level, the NTRC oversees all betting interests that are licensed in the NT, including global concerns such as Betfair, Entain Group, Draft Kings and Sportsbet.

Contents of Private Document Made Public

Julian Hoskins, principal of one of Australia’s largest gambling law and regulatory consultancies, Senet, has seen a private document circulated among licensees and chose to shed light on its contents:

Any licensee, for example a sports bookmaker licensed in the Northern Territory, who wants to accept cryptocurrency for billing or paying wages needs permission to do so. And there are certain conditions attached to that.

Julian Hoskins, Senet

“It is clear from the conceptual framework that they are looking at cryptocurrency gambling and not simply exchanging [crypto] for fiat,” Hoskins added, pointing out that gamblers will most likely have to place fiat and crypto bets separately on the one platform as the two financial instruments will not be interchangeable for gambling.

Given the popularity of crypto, I imagine it would be very popular as an alternative to fiat. I think it has the potential to be quite material.

Julian Hoskins, Senet

Other States Likely to Follow Suit

Hoskins says that if this model went according to plan in the Northern Territory, gambling regulators in other states would likely follow suit, while also noting that strict identification requirements have been proposed to maintain compliance with anti-money laundering (AML) regulations. As such, gamblers will most likely have to have their crypto wallet addresses verified, with any winnings sent back to the same wallet that made the initial deposit.

According to the document, the NTRC has recommended monthly crypto deposit limits of A$2,000 for the first 12 months, with a maximum bet of A$5,000 per month.

Mindil Beach Casino, Perth, NT. Source: mindilbeachcasinoresort.com.au

Hoskins, who is a gambling industry lawyer, also explained that local gambling companies will be required by law to maintain crypto wallets that contain enough funds to fully collateralise customers’ wagering amounts, as is common in fiat-based gambling.

As for the tax implications of using volatile crypto assets to gamble, Hoskins said he was not sure “how that would be handled”, which suggests the NTRC is still considering such issues.

This all comes just days after the recently elected federal government outlined its approach to crypto regulation, with Treasurer Jim Chalmers announcing a “token mapping” exercise that is expected to help “identify how crypto assets and related services should be regulated”.