Commonwealth Bank of Australia recognizes risk of missing out on cryptocurrencies

Commonwealth Bank of Australia (CBA) CEO Matt Comyn said the bank is more concerned with the risk of missing out on cryptocurrencies than the risks associated with their adoption.

CBA will be the first of Australia’s “Big Four” banks to offer cryptocurrency-based services, after the bank announced on Nov. 3 that it would support trading of 10 digital assets directly through its banking app.

In an interview with Bloomberg TV on Friday, November 19, Comyn was asked about the CBA’s view on the cryptocurrency space, and the CEO stated:

“We see the risk of participating, but we see the greater risk of not participating. We have no view on the asset price itself, we have to say, we see it as a very volatile speculative asset, but we also Don’t think this industry and technology will disappear anytime soon.”

Comyn also said that there will be more to CBA’s cryptocurrency adoption game, as he emphasized that the bank sees many use cases from blockchain technology, as well as strong demand from consumers.

“So, we want to understand it, we want to provide customers with a competitive product, and properly disclose the risks. We want to build capabilities in DLT and blockchain technology,” he added.

ASIC cannot regulate the industry

While the CBA appears to be bullish on cryptocurrencies and distributed ledger technology, the Australian Securities and Investments Commission (ASIC) has urged caution for investors, while also stating that it cannot police the industry.

Speaking at the Australian Financial Review Super & Wealth Summit on Nov. 22, ASIC chairman Joe Longo said the financial enforcement agency cannot regulate cryptocurrencies because the asset class currently does not qualify as a “financial product” in Australia.

"The demand-driven nature of cryptocurrencies presents some unique challenges. Currently, many crypto assets may not be 'financial products', making it difficult for financial advisors to advise."

"ASIC has provided some guidance on exchange-traded funds related to crypto assets - they are at least financial products and traded on exchanges with trading licenses, so there will be some protection there - but for the most part , at least for now, investors are on their own," he added.

In Longo's personal opinion, he urged local investors to pursue cryptocurrencies very cautiously, noting, "I thought of the adage 'don't put all your eggs in one basket'". However, he also emphasized that the cryptocurrency proposal introduced by the Australian Senate last month was the right move for the local climate.

“Whether we approach it from a policy perspective, Senator Prague’s committee rightly highlights the fact that cryptocurrencies are on our doorstep, here and now, driven by extraordinary consumer and investor demand,” he said.