Top-3 Australian Bank Nixes Fiat Payments to Binance

National Australia Bank (NAB) will combat fraud and scams by reportedly blocking payments to high-risk cryptocurrency exchanges, including Binance. The move was announced on Monday and aligns with a broader regulatory crackdown in the digital currency sector.

The news comes shortly after the securities regulator of Australia revoked the financial services license held by Binance Australia.

Tightening the Screws on Binance

NAB’s actions further pressure Binance, which has been under scrutiny in several jurisdictions. The exchange could expand in other jurisdictions while losing Australia as an important market.

While speaking to the Financial Review, NAB’s head of fraud, Chris Sheehan, refrained from naming the specific cryptocurrency exchanges being banned, stressing that the initial ban will apply to “several” exchanges and could eventually extend.

The former police officer highlighted that the bank aims to maintain consistency with industry standards.

Westpac and the Commonwealth Bank had already started to ban payments to Binance, according to earlier reports by the Australian Financial Review. It also noted that ANZ plans to follow suit. Which, in turn, restricts Binance’s ability to deposit and withdraw fiat money from local banks.

Binance also lost its local banking partner Cuscal, which facilitated payments through PayID. The Australian Securities and Investment Commission (ASIC) also withdrew Binance’s local derivatives license.

In the US, the Securities and Exchange Commission (SEC) alleged that Binance and its CEO, Changpeng Zhao, intentionally evaded laws and operated an illegal exchange.

Consumer Protection and Deterring Scams

BeInCrypto reported earlier this year that Australian citizens are the favorite target of crypto scammers. Meanwhile, CBA CEO Matt Comyn told the paper that half of the scams identified by his bank were linked to crypto.

CBA is the same bank that became the first in Australia to announce crypto-services last year. However, it quickly reversed the decision to launch the app after the announcement. 

Instead, Australian banks have strengthened their regulations in response to rising losses from cryptocurrency scams, especially after the UK implemented a reimbursement procedure for customers who had been defrauded.

Contrarily, Sheehan argued for collaborative efforts between banks, telcos, online platforms, customers, and the government to prevent these incidents in the first place.

Binance announced the discontinuation of AUD deposits and withdrawals via bank transfer for Australian users on June 1. In May, Binance also lost access to Australian dollar transfers through its PayID payment portal as banks narrowed payment options.

Australian senator Andrew Bragg previously advanced a bill that called for a crackdown to control the local cryptocurrency business. Meanwhile, in 2023, Australia became the country with the highest adoption of cryptocurrencies, according to a recently published study.