Category: Cryptocurrencies

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Australia Crypto News Cryptocurrencies

Australians Secure the Bag: Economic Stimulus Spent on Retail, Crypto, Cocaine

The Australian government has announced that it will extend record-breaking stimulus support payments into 2021, detailing several multi-billion dollar efforts to protect Australian jobs from the COVIC-19 pandemic. 

While the fiscal efforts of the Australian government are designed to assist Australian families, employees, and employers through the pandemic-induced financial crisis, Australian consumers have other ideas on how stimulus capital should be spent. 

Aussies Spend Super Funds on Furniture, Gambling, Cryptocurrency

Data published by Accenture’s illion and AlphaBeta platform indicates that retail spending in Australia has skyrocketed 17 percent above normal levels, with over 2.8 million Australians seeking early release of superannuation funds as part of the Australian Government’s COVID response. 

Consumer spending across Victoria, which has recently returned to stage 3 lockdown in several regions including Melbourne, has decreased due to lower retail activity — but that hasn’t stopped Australians in other states from spending 54 percent more than normal at department stores, 51 percent more on online gambling, and 114 percent more than normal on furniture.

The retail sector isn’t the only market benefiting from COVID stimulus — Australian cryptocurrency purchasing and investment patterns match those published by popular cryptocurrency exchange Coinbase earlier this year, with Australians investing a portion of the $2.8 billion paid out thus far under the early superannuation release scheme directly into crypto markets.

Cocaine Use at 20-Year High

While the retail and cryptocurrency markets are experiencing an inflow of new capital, so too is the Australian illicit drug trade. Australians in lockdown, according to academic data, are more likely to spend money on illicit drugs such as cocaine, resulting in a large spike in cocaine use across the country.

Data published by the Australian Institute for Health and Welfare reveals that cocaine use is at a 20-year high — academic studies into the impact of the COVID-19 lockdown on Australians indicate that lockdown periods are likely to increase illicit drug use in Australia despite supply chain interruptions.

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Crypto News Cryptocurrencies Cryptocurrency Law

Aussie Crypto Entrepreneurs Target Google, Facebook, & Twitter with $300 Billion Class Action Lawsuit

Sydney-based legal firm JPB Liberty is preparing to sue international tech giants Google, Facebook, and Witter in a massive Australian class action lawsuit that could potentially see major platforms pay over $300 billion USD, or $436 billion AUD.

Spearheaded by Israeli-Australian lawyer Andew Hamilton, the Sydney-based legal firm — which also maintains offices in Tel Aviv — aims to take multiple social media giants to task over cryptocurrency-related advertising bans executed by the platforms in 2018.

Claimants: Crypto Advertising Bans Harm Legitimate Businesses

Crypto currency-related ads on Google, Facebook, and Twitter were banned in 2018 by all three platforms within a single month. While the bans were reversed in late 2018. Facebook maintained pre-approval for blockchain-focused ads and a review process for any advertisement regarding cryptocurrency-related services or products.

JPB Liberty’s class action lawsuit has attracted multiple litigants, accumulating over $872 million worth of claims thus far, and is currently pending funding to file subsequent to senior barrister review. The Sydney-based law firm will represent companies and individuals that claim that the sweeping bans enacted by social media platforms harmed their businesses. 

Law Firm Seeks Funding to Execute 

Cryptocurrency entrepreneurs participating in the class action lawsuit state that the low number of regulated exchanges in 2018 and the largely unregulated nature of the cryptocurrency ecosystem that lead to the sweeping bans impeded legitimate business growth. 

JPB LIberty is currently organizing funding from institutional litigation funders, investors, and venture capital sources — claimants stand to gain 70 percent of any possible settlement, while funders will capture 30 percent.

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Bitcoin Cryptocurrencies Cryptocurrency Tax

Over 340,000 Australians Won’t Be Getting a Tax Refund — Including Aussie Crypto Traders

The Australian Taxation office has received over 1.7 individual tax returns in 2020, a 12 percent increase over last year. As online lodgements spiked over 640 percent on July 1, however, the ATO has been quick to remind Australian taxpayers that not everybody is going to get a tax return, based on the rate of mistakes made in this year’s returns.

Tax returns filed from the 1st of July have broken an all-time record for online lodgements, with the ATO receiving in excess of 740,000 returns, compared to the 100,000 returns received in the same time period in 2019.

Despite a large number of early tax return lodgers, it’s highly likely that many Australian taxpayers won’t receive a tax return in the first batch of payments —of which $1 billion has already been distributed — due to a number of common mistakes.

The ATO has highlighted a number of major errors that are commonly made in tax returns, which are likely to prevent over 20 percent of early lodgers from receiving a payment. 

ATO Warns Crypto Holders to Declare Crypto Gains

ATO assistant commissioner Karen Foat highlighted the importance of manually adding any and all sources of income when lodging a tax return in a statement this week — specifically mentioning cryptocurrency gains.

“We are asking taxpayers to add any amounts that aren’t automatically included to your return. This includes cash wages, foreign-sourced income, or even gains from cryptocurrency,”

While cryptocurrency gains can be accessed in a wide variety of ways, the ATO has recently taken specific measures to combat cryptocurrency-based tax evasion — notably issuing over 350,00 tax warning letters to Australian taxpayers associated with cryptocurrency usage. 

Cryptocurrency tax can be relatively complex in Australia. If you’re not sure of your tax obligations regarding cryptocurrency in Australia, check out Crypto News Australia’s cryptocurrency taxation guides.

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Cryptocurrencies Cryptocurrency Law Regulation

Cashless Australia: COVID-19 Pandemic Accelerates Digital Payments as Gov Prepares to Criminalize Certain Cash Payments

The COVID-19 pandemic has halved cash payments throughout Australia as health-conscious consumers shift towards digital and contactless payment options. With bank branches and ATMs set to slowly disappear, Australia is positioned to be one of the most cash-free countries in the world.

Commonwealth Bank insights indicate that Australia will be wholly cashless by 2026, ranking Australia as the 6th most cashless society in the world. A cash-free future, however, has many Australians concerned.

While a cashless economy allows for greater financial security, queuing times, more efficient taxation, and more efficient hygiene routines, opponents of the cashless revolution cite the necessity of cash transactions for the unbanked and underbanked.

Australian Government Set to Legislate Against Cash Payments

Australia’s cashless future, however, could be mandatory. Government limits on cash transactions that present the risk of prison time if violated are already in the works — in 2019, the Morrison Government proposed legislative changes that would criminalize cash transactions in excess of $10,000.

The Currency (Restrictions on the Use of Cash) Bill 2019 is yet to be finalised, but will establish four new criminal offenses that relate to cash payments that exceed $10,000 for goods or services transacted between two individuals or parties.

Notably, these offenses will apply to anybody regardless of their awareness of the new legislation, should it pass, with a maximum penalty of two years in prison and or a $25,200 fine. The core premise of the bill focuses on eliminating the “black” economy, minimizing money laundering, bribery, terrorist financing, and tax evasion. 

Introducing legislation that criminalizes cash transactions over a certain amount, however, is likely to accelerate the adoption and use of cryptocurrency. The Restrictions on the Use of Cash Bill specifically refers to cryptocurrency, stating:

Crypto-currencies and other digital currencies are generally unregulated and often do not create clear records of transactions in a form that can easily be used to identify the parties to a transaction.

Cryptocurrencies a Dark Horse in the Race Towards Cashlessness

The Treasury’s Black Economy Task Force is aware of the virtually untraceable nature of cryptocurrency transactions not associated with a crypto-to-fiat bridge, noting that some non-cash payment methods, including the many cryptocurrencies which are being traded, are just as anonymous as cash. 

With the COVID-19 pandemic accelerating the use of digital fiat payments and significantly contributing to the adoption and use of cryptocurrency payments, Australia is indeed transforming into a cashless society. 

Whether or not the new digital payment platforms used by everyday Australians in our cashless future will resemble centralized fiat currency or decentralized cryptocurrency virtually immune to legislative control, however, remains to be seen.

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Bitfinex Cryptocurrencies

Crypto Traders Shift Towards DEX Platforms as Trust in Centralized Exchanges Dwindles

The cryptocurrency market is home to thousands of cryptocurrency exchanges — most of them wholly centralized and prone to hacks, mishandling of client funds, and outright exit scams. 

While centralized exchanges such as Coinbase, Binance, and Bitfinex have dominated crypto market volumes over the last decade, the next generation of decentralized exchanges, or DEXs, are slowly winning over security-conscious traders and investors.

Cryptocurrency price and market capitalization platform CoinGecko released its Q2 2020 Quarterly Cryptocurrency Report on July 9, revealing insight into the latest trading habits of cryptocurrency investors — decentralized exchanges are gaining traction.

Centralized Exchanges Lose Volume as DEXs Gain

Data revealed in CoinGecko’s report indicates that spot volume on major centralized crypto exchanges such as Binance have decreased by $324 million, or 7 percent. Both Binance and Bitfinex, two of the largest centralized crypto exchanges, experienced a significant reduction on total spot trading volume in the first half of 2020.

The apparent reduction in spot trading volume on centralized exchanges, however, has been balanced by a significant increase in trading volume on decentralized exchange platforms.

Q2 2020 saw an increase of 56.1 percent in trading volume on DEX platforms, with decentralized exchanges such as Uniswap V1 experiencing an increase of 152.4 percent.

Bitfinex Embroiled in Court Case Over Mishandled Client Funds

The reduction in major centralized crypto exchange volume is driven, in part, by continuous hacks and mishandling of user capital. Earlier this week, a New York State appeals court ruled that the exchange must face claims that it hid the loss of commingled client and corporate funds.

Companies related to the Bitfinex exchange platform are accused of hiding over $800 million in both client and corporate funds.

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Australia Bitcoin Cryptocurrencies Victoria

Australian Crypto Adoption Accelerates, Experts Predict $13k USD Bitcoin as COVID-19 Lockdown Returns

Millions of Australians are now unable to leave home due to the return of COVID-19 quarantine measures — but crypto markets remain open, amplifying cryptocurrency trade, investments, and real-world use cases.

Victoria Premier Daniel Andrews announced the first closure of Victorian state borders in over a century on Monday July 6th, heralding a return to stage 3 lockdown for an additional six weeks across the state. 

The COVID-19 pandemic and ensuing lockdowns have decimated share markets, rocked the Australian economy, and forced over 70 percent of Australian businesses to accept support measures facilitated by the Australian government such as wage subsidies or deferred loan repayments.

Bloomberg Analysts Predict $13,000 Bitcoin

The fiat economy is struggling to recover from the ongoing international coronavirus lockdown. The digital asset economy, however, is showing strong signs of life — Bloomberg Intelligence’s July 2020 Crypto Outlook reveals a positive outlook on mid-year digital asset markets, citing favorable macroeconomic conditions and record-breaking inflows of institutional capital.

Bitcoin is in high demand, with Bloomberg analysts predicting a breakout pushing BTC prices to a $13,000 USD ceiling — a prediction mirrored by Australian cryptocurrency investors and traders.

Early March lockdown announcements around the world saw investors flood crypto markets with buy orders, with major exchanges such as Binance experiencing a 500% increase in deposits that exceeded $1.3 billion in just 48 hours.

Stimulus Payments Stimulate Crypto Market

Stimulus payments provided to Australians and US citizens by their respective governments have also appeared to have played an important role in bolstering the crypto economy. Although stimulus payments were intended to help Australians cover expenses during the financially difficult lockdown period, market analysis reveals that many recipients have directed stimulus capital towards digital asset investments.

Coinbase co-founder & CEO Brian Armstrong published Coinbase reposit data in mid-April revealing a significant spike in cryptocurrency purchases that match the $1,200 US stimulus package, a pattern reflected in Australian crypto markets.

Data published by blockchain analytics firm Glassnode indicates renewed global interest in cryptocurrency — the number of active Bitcoin addresses that hold 0.1 BTC or more reached a new all-time high in mid-June.

The seven-day moving average of the number of active Ethereum addresses has also peaked to the highest point in two years, mirroring numbers last seen before the late-2017 all-time Bitcoin price high of nearly $20,000 USD.

Australians aren’t only interested in buying cryptocurrency, however — they’re also spending it in Australian retail stores at record numbers.  Data published by crypto payment platform HULU via Bitcoin Cash reporting platform Bitcoin BCH indicates that retail crypto spending is returning to pre-lockdown levels via HULU alone.

With over $180 billion in value transacted over the Bitcoin network in the second quarter of 2020, Bitcoin dominance continues, amounting to $2 billion per day in value transfer.