National Australia Bank (NAB) has announced new measures that block certain cryptocurrency platforms to “protect customers.” The move comes as part of NAB’s “bank-wide scam strategy” and follows similar actions taken by other major Australian banks. NAB’s executive for group investigations and fraud, Chris Sheehan, stated that the blocks would target “high-risk” platforms where scams are more prevalent.
These scammers are part of organized, transnational crime groups. Increasingly, we’re seeing them use cryptocurrency platforms to send stolen funds quickly and often overseas
Chris Sheehan, National Australia Bank’s executive for group investigations and fraud.
While NAB did not disclose the names of the specific exchanges affected, Sheehan hinted that Binance could be among them, following the footsteps of other Australian banks. Westpac and the Commonwealth Bank have reportedly already blocked payments to Binance. NAB’s decision aligns with industry practices, aiming to protect customers from potential risks associated with certain platforms.
Crypto-related scams have been on the rise in Australia, with nearly 50% of reported scam funds linked to cryptocurrencies. NAB highlighted that Australians lost over $221 million to cryptocurrency scams last year, emphasizing the urgency of addressing this growing security threat. The bank further emphasized that 40% of Australians would prefer slower payments if it meant better protection against scammers. Around 30,000 Australians were reportedly affected by the collapse crypto exchange FTX in November 2022.
Meanwhile, Bank of America’s recent closure of accounts associated with Coinbase transactions has raised concerns within the cryptocurrency community, sparking tensions between traditional financial institutions and the crypto world. Muneeb Ali, the founder of Stacks, took to Twitter to express his frustration after his account, which he had used for Bitcoin investments for 15 years, was closed without warning. Ali’s tweet garnered significant attention, with him describing it as a “war on Bitcoin & crypto.”
Coinbase CEO Brian Armstrong conducted a poll on Twitter to investigate similar closures experienced by other users. Out of over 16,000 respondents, 8.9% confirmed account closures, and over 1,100 individuals reported Bank of America account closures linked to their Coinbase usage. This situation further amplifies the contentious relationship between traditional financial institutions and cryptocurrencies.
On the other hand, Bank of America recently expressed admiration for Ripple, praising its innovative solutions and potential to revolutionize the global financial industry. The bank acknowledged Ripple Labs’ role in the Asia-Pacific region’s payments sector and highlights its potential in digitizing trade documents and transforming cross-border payments.
These contrasting stances from banks underscore the challenges and obstacles the crypto industry encounters as it seeks wider adoption. While certain banks recognize the potential benefits of blockchain technology and specific cryptocurrencies like Ripple, others remain cautious due to the increased risk of scams associated with some cryptocurrency platforms. Striking a balance between security and innovation will be crucial for the sustainable growth of the crypto sector.