310 digital currency exchanges registered with Austrac

They occurred after the watchdog got the green light in December 2017 to extend anti-money laundering and counter-terrorism financing regulation to digital currency exchanges.
Written by Asha Barbaschow, Contributor

The Australian Transaction Reports and Analysis Centre (Austrac) revealed it has registered 310 digital currency exchange providers since April 2018, after it gained authorisation the prior December to extend anti-money laundering and counter-terrorism financing regulation to cryptocurrency.

The Anti-Money Laundering and Counter-Terrorism Financing Amendment Bill 2017 requires DCE providers to enrol with Austrac and register on the Digital Currency Exchange Register the government agency maintains.

Exchanges are also required to adopt and maintain a program to identify, mitigate, and manage the money laundering and terrorism financing risks they may face. Similar to a bank, the exchange must also identify and verify the identities of their customers; and report suspicious matters, international transactions, and transactions involving physical currency that exceed AU$10,000 to Austrac.

Certain records related to transactions, customer identification, and their program must also be kept for seven years.

Between April and August 2018, Austrac received between 20 and 58 new registrations per month. Since that time, monthly registrations have remained below 20.

Austrac said it does not monitor the total volume of digital currency exchanges and does not monitor the total amount of money that passes through digital currency exchanges.

The figure was provided by Austrac in response to questions on notice to the Senate Economics Legislation Committee and its probe into the Currency (Restrictions on the Use of Cash) Bill 2019.

See more: Australia to ban cash payments over AU$10,000 in the name of thwarting crime

The Bill, which passed the lower house in October, would essentially block the purchase of goods over AU$10,000 via cash and introduce offences for entities that make or accept cash payments of AU$10,000 or more. 

Facing the committee in December, Austrac was asked if introducing a ban on cash payments over AU$10,000 would drive people into the cryptocurrency space and, if indeed that were to occur, whether Austrac possesses the capability to deal with that effectively.

"Austrac considers that it is unlikely that the implementation of the cash payment limit will drive people into the cryptocurrency space at this point in time," it said.

"Despite being available for the past 10 years, cryptocurrencies remain a relatively niche market.

"The price of virtual assets is volatile, and the ability to use cryptocurrency in the course of everyday consumer and business transactions is limited."

Austrac said it is "monitoring the emerging risks associated with virtual assets".


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