Dozens of Australian Bitcoin traders have accused the country’s biggest banks of refusing to do business with them in an effort to shutdown the cryptocurrency industry.
The Commonwealth Bank, Westpac, ANZ and the National Australia Bank are among the financial institutions that have been named and shamed by Bitcoin traders, who have spoken of their experiences for the first time.
Michaela Juric, 22, has been trading the virtual currency Bitcoin for two and a half years.
Recently her business bitcoin-babe.com has come under threat because the country’s biggest banks refused to do business with her.
“I’ve been blacklisted from Commonwealth Bank, National Australia Bank, Westpac, St George, Bank of Melbourne, Bank SA, Bank of Queensland, Rams and BT Superfund.
“I can’t open or hold any accounts with those institutions because I deal with Bitcoin,” she said.
Ms Juric believes banks see Bitcoin as a threat, and she claims to know at least 50 other traders in Australia who have been through the same thing.
Daniel Wilczynski, 28, is a former Bitcoin trader who is now out of business after having his personal and business accounts closed by six different banks.
“The banking institutions frankly see a lot of this as a threat.” – Labor Senator Sam Dastyari
“Everything was going well, but my first bank closure was by NAB and then I had ANZ close, and then Westpac and then about two months ago the Commonwealth Bank closed my bank accounts,” he said.
Mr Wilczynski said both his personal and business accounts were shut down, resulting in a substantial financial and personal loss.
“I was thinking of hiring somebody, I could have had an extra developer working with me right now, and instead I’m out of a job and out of income trying to figure out what to do.”
Another man who spoke to the ABC on the condition of anonymity said he had experienced the same discrimination at the hands of Australia’s biggest banks.
The Bitcoin trader, who is aged in his 30s, said he was scared to reveal his identity because he feared that the only bank still holding his accounts would move to shut them down if they knew he was dealing with Bitcoin.
“I’m incredibly wary,” he said.
“Usually at the branch level it’s not a problem, but when the headquarters finds out that’s when the shutdowns happen.”
Labor Senator Sam Dastyari, who chaired the Senate Economics References Committee into digital currency, said he was outraged by the bank account closures.
“I think the whole thing is outrageous,” he said.
“The situation where the large financial institutions gang up together to prevent the growth of new industries – it’s a very, very worrying concern.
“What worries me from an industry perspective is this is an area we should be promoting, this is an area we should be growing… and yet you have this complete opposite outcome from the banking institutions who frankly see a lot of this as a threat.”
Calls for clearer regulation of digital currencies
The ABC put two questions to the Commonwealth Bank, ANZ, Westpac and NAB:
- What is the bank’s official policy when it comes to dealing with Bitcoin traders?
- Why does the bank refuse to let those who deal with Bitcoin hold accounts?
A spokeswoman from the CBA refused to answer the questions, saying only that the Commonwealth Bank “consistently serves each customer on a case-by-case basis”.
A spokesman from Westpac said he could not comment on individual customers and ANZ have yet to respond.
Tony Pearson, the acting CEO of the Australian Bankers’ Association, maintains that financial institutions have the right to choose who they do business with.
“Digital currencies are not subject to regulation or oversight,” he said.
“The lack of transparency and regulatory oversight raises a number of risks for users and also poses risks for the payments system, the integrity of the financial system and the erosion of the tax base.
“Given the risks, there is a need for a clear and settled legal and regulatory framework for digital currencies.”
Michaela Juric dismissed the banks’ replies as rubbish arguing Bitcoin was regulated because, among other reasons, traders had to pay GST
“If someone purchases Bitcoin from me and something goes wrong, they have every right to lodge a complaint with Fair Trading,” she said.
“Now if we weren’t regulated that couldn’t happen, if we weren’t regulated then we couldn’t be asked to be paying tax on Bitcoin, so I think they’re just saying what they want so they don’t have to deal with it,” she said.
Senator Sam Dastyari urged Australia’s banks to find ways to work with Bitcoin traders.
“We want to make sure the legitimate businesses in this space that are trying to grow, that are trying to create new, innovative Australian jobs aren’t stifled.
“And what worries me is this idea that you have these major big financial institutions who – let’s not kid ourselves – have an incredible amount of power… and that power has been used in this case to stop the growth of a new industry,” he said.