Paulina Duran

SYDNEY. (Reuters). Australia’s bank watchdog has said that it was examining potential regulatory consequences of Commonwealth Bank’s plan to offer bitcoin trading services to unsophisticated retail customers – which is the first such initiative by an Australian bank.

CBA stated that it is open to a clear regulation framework for crytpocurrencies. They are currently not formaly regulated in Australia.

CBA announced Wednesday that it would be the first major bank to provide a trading platform to its retail customers for cryptocurrencies.

This move forces financial watchdogs to Australia immediately concentrate on the highly volatile cryptocurrency trading industry worth $2 trillion. Some argue it lacks intrinsic value. It relies on trust from users in various software.

A spokesperson for Australian Prudential (NYSE) Regulation Authority (APRA) stated that the largest bank in Australia had informed the regulator of the plans, and that the agency was currently “examinating regulatory issues this may raise”.

CBA will provide easy access to cryptocurrency trading in 10 assets after a pilot program for around 2,000 Australians. This is in addition to its mobile banking app that’s the industry leader and offers discounts to energy retailers as well as carbon emission tracking.

CBA will offer crypto trading services in collaboration with Gemini Trust Company. This is one of the largest cryptocurrency exchanges in the world, which was founded in 2014 by Gemini Trust Company. It’s also known for its accusations of Facebook’s founder, NASDAQ:).

Australian Transaction Reports and Analysis Centre, an anti-money laundering watchdog, stated that they were “engaging…in relation to this product offering with CBA and Gemini.”

CBA stated that it is open to regulatory clarification in this area and that their product has been designed with regulatory and risk-mitigation concerns and bank front and center. This product will ensure users feel comfortable using it.

We would welcome clarity on crypto assets regulations. It would enhance the market and trust, and raise customer protection,” stated Sophie Gilder (head of Blockchain at Commonwealth Bank and project leader).

CBA’s offer will include a “closed circuit” connecting to a CBA account. This would allow for monitoring with Chainalysis cryptocurrency anti-money launder services in case of suspicious activity.

Gilder explained that “we have complete transparency about customer activity” and is able to report to regulators if necessary.

We won’t, once the pilot is over, make it available to all. This will take place over a longer period of time, which is more appropriate given the volatility in crypto.