Australian Regulator Asks Banks To ‘Proceed With Care’ Over Crypto

ARPA said it will issue a letter detailing its expectations for how digital assets should be handled


Australian Parliament in Canberra | Source: Shutterstock


key takeaways

  • Australian Prudential Regulation Authority chair Wayne Byres said his agency wants to provide institutions with “more clarity” on crypto regulation
  • The letter is not expected to introduce new regulatory requirements, the chair said

A major Australian financial regulator said Thursday it was in the final stages of issuing a letter to financial institutions that set out its expectations for how digital assets in the country should be handled.

In a speech to the American Chamber of Commerce, Australian Prudential Regulation Authority (APRA) chair Wayne Byres said the regulator wants to provide institutions, including banks and retirement funds, with “more clarity” relating to crypto and financial regulation.

APRA’s letter follows the UK’s lead in issuing a statement detailing how digital assets, such as bitcoin, stablecoins and non-fungible tokens (NFTs), could pose a risk to financial stability, he said.

“Much like our approach to climate risk, [the letter’s] underlying message is primarily one of: ‘by all means innovate, but proceed with care and in full knowledge of the risks’,” Byres said.

Byres’ speech also follows a recent announcement by the Australian government to introduce legislation that seeks licensing and custody measures for the country’s burgeoning digital asset industry. The government is also considering changes to the way the nascent asset class is taxed.

The letter will not introduce new regulatory requirements, Byres said. The message from the regulator comes at a time when financial institutions have been exploring ways to offer crypto to their customers.

Last month, Sophie Gilder, managing director of blockchain and digital assets at one of Australia’s top banks by assets, Commonwealth Bank, said her institution’s experience with crypto had been “overwhelmingly positive.”

CBA announced back in November it would be launching its crypto pilot program, granting select customers the ability to buy, sell and hold digital assets directly through the bank’s CommBank app.

After launching in December, the bank became the first of its kind in Australia to offer crypto products directly to its customers. APRA is now concerned that could entice other regulated institutions to follow the bank’s lead by offering those products.

In a further sign of the uncertainty for crypto presented by the country’s regulators, the Australian Securities and Investments Commission — another major watchdog — is causing headaches for CommBank.

Legal discussions are reportedly delaying the rollout of the bank’s offering to customers which centers on the wording of its product disclosure statement, the Australian Financial Review reported Tuesday.

While the chair recognized his agency’s role as having a mandate on promoting financial stability within the country, that mandate did not translate to restricting innovation “with a view of preserving the status quo.”

“If technology can deliver a financial system that is indeed better, safer and more efficient, our task is to embrace the changes for the benefit of the Australian community,” he said.

Don’t miss the next big story – join our free daily newsletter.


Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

Mon - Wed, March 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience: Attend expert-led panel discussions and fireside chats Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts.

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Top Icon.png


Osmosis thrived in H2 2023 on the back of increased DeFi activity deriving from recently launched Cosmos-related projects and better market conditions. With new value accrual mechanisms for the native token, Osmosis is well-positioned to continue its strong performance in 2024.



Though the opposing flow trend is likely to slow over time, industry watchers note, bitcoin fund assets could one day eclipse the $90 billion gold ETF space


Celestia had the first mover advantage. EigenDA has staked ether. What sets Avail apart?


Bitcoin moved 1% higher Monday morning in New York, Matrixport analysts say $62,000 could happen next month


It’s hard to believe right now that crypto — even with all of its flexibility and massive capabilities — could ever be like cash on the internet


Michael Saylor announced Monday morning that MicroStrategy bought 3k more bitcoin after the X account was compromised over the weekend


Plus, Pudgy Penguins grows its brand and a group of Autoglyphs sell for $14.5 million