More than 25% of people in Australia own cryptocurrencies, according to recent data. In the coming years, the number will increase as the market recovers its confidence in the sector following a series of project failures in 2022.
Australians use crypto for various purposes, from paying bills to making transactions with foreign sellers. The use of crypto in the Australian gambling industry has also increased over the past few years.
For instance, people can use digital currencies in sports betting or online casino activities involving real money in Australia.
Authorities in Australia have also legalized crypto use, such as Bitcoin and Ether. Residents can use these tokens to make transactions. However, merchants have the freedom to decide whether they will accept crypto payments.
More businesses in Australia will likely dip their toes in crypto due to the enthusiasm surrounding the nascent industry. As crypto payments become more accessible, there will be more adopters of digital currencies in the future.
Furthermore, Australian lawmakers have proposed ways to improve protection for crypto consumers.
Earlier this year, an Australian senator introduced a bill that will impose standards on the crypto industry in the country. The bill encompassed licensing permits for crypto exchanges, custodians, and the issuance of stablecoins.
Why do Australians invest in crypto?
Despite the crypto winter last year, the interest in crypto among Australians remains high. People in Australia invest in cryptocurrency for various reasons.
Potential profit
Crypto allows investors to make a large profit despite its risk. Take the DOGE coin as an example. The fourth most popular token in Australia rallied late last year after news of possible integration with social media Twitter.
At that time, DOGE holders could multiply their initial investment in the token. Some “whales” even gained millions of dollars by selling DOGE during its peak.
Still, financial advisors suggest investors be prepared for the volatility of this market. Investors are recommended to check each crypto’s track record. They also need to diversify their crypto portfolio to protect against a sudden market crash.
New technology
The growing interest in crypto among Australians is also related to people’s interest in new technology. Crypto operates on Web3 or blockchain, which many have dubbed to be the “future of the internet.”
This new technology offers many advantages compared to its predecessors, including personalized interactions. The technology uses artificial intelligence and machine learning to improve responsiveness toward users’ needs.
Web3 also offers transparency. On a blockchain, users can see how transactions take place. They can also see how validators authorize transactions. Enhanced transparency strengthens the accountability of crypto.
It creates awareness of the risks linked to the market.
Desire to move away from traditional banking
Crypto operates on decentralized networks, allowing people to conduct transactions without intermediaries. This new financial system omits the issues in traditional banking, such as high fees and long processing times.
A crypto user can make payments to another user in the other part of the world with a few clicks.
Several new decentralized finance (DeFi) projects provide enhanced banking services to crypto consumers. In Australia, for instance, some DeFi platforms offer crypto lending services to users.
The decentralization feature of crypto also entices investors because it offers improved privacy. Users can move funds from one wallet to another anonymously. It provides a sense of financial freedom to people.
Authority encourages banks to support crypto exchanges
The Australian Department of the Treasury published an official statement in June to address the country’s debunking policy, including its relation to the crypto sector. The financial authority requested major Australian banks to provide clear guidance for crypto exchanges.
This request came after several major banks, including Westpac and Commonwealth Bank of Australia (CBA), announced restrictions on payment processing services to crypto exchanges.
They reasoned that the restriction is a precautionary step to protect customers from fraudulent activities associated with cryptocurrency transactions. CBA began implementing its restriction in June.
A CBA executive said implementing measures such as 24-hour holds, payment declines, and outbound payment limits to cryptocurrency exchanges would help reduce fraud.
In the future, the bank intends to impose a monthly payment cap of AU$ 10,000 (US$6,700) for transactions made to crypto exchanges. Earlier, Westpac also banned its customers from making transactions in certain crypto exchanges.
According to the Australian bank, crypto scams represented a significant part of fraudulent transactions that the bank processed in 2022. It also pointed out that crypto scams caused large financial damage to Australian banking customers.
Australia’s Treasury said the current debunking trend could hurt the country’s crypto sector.
The government said the situation could stifle competition and innovation in financial services. It asserted its commitment to work with banks and other industry players to develop “effective and achievable” solutions for the current issue.
To show support for cryptocurrency and its users, the Australian government has taken action by addressing the issue of scams.
It has established a National Anti-Scam Center (NASC) through the Australian Competition and Consumer Commission to combat scammers and provide consumers with information on how to avoid becoming a victim.
The NASC intends to pool resources and knowledge to protect Australians from cryptocurrency scams. It will open on July 1 and focus on increasing consumer awareness.