Australian-based cryptocurrency exchanges have lined up to quash contagion fears after the payments provider for Binance Australia was told to offboard the exchange, though some have warned risks still loom.
On May 18, Binance Australia told users that Australian dollar services were suspended after its payments partner Zepto was told by its partner firm Cuscal to stop support for the exchange.
Independent Reserve CEO Adrian Przelozny told Cointelegraph he doesn’t think “this an industry-wide issue as it appears to be Binance-specific,” adding the Australian dollar deposits and withdrawals for his exchange “remain uninterrupted.”
BTC Markets CEO Caroline Bowler said she had “no due for concern,” adding “we work really closely with [our payments provider], specifically on scams.”
A brief note to reassure Aussie crypto traders that @BTCMarkets AUD payment rails are unaffected and open for business.
— Caroline Bowler (@CaroBowler) May 18, 2023
“Nothing’s been alerted to me that there are any concerns with BTC Markets,” she said. “We are accountable to them on a monthly basis and have been for a sizable period of time.”
Jonathon Miller, Kraken Australia’s managing director told Cointelegraph there are “only a couple” of payment providers in the local market “that are crypto-friendly, and we’ve got a really strong relationship with them.”
“It’s very unfortunate to see a business in a position where they have to cut their client’s access overnight,” he said.
“It’s not great for the end user, it’s not great for the industry but it seems like it’s part of a broader story with what’s been happening with that enterprise for some time.”
Some of the executives noted a significant uptick in the users, downloads, or registrations on their platforms as Binance users seemingly hunt for alternative exchanges with AUD payment ramps.
Debanking risks still lurk
Despite assurances, some of the execs noted the regulatory environment in Australia for crypto gives way to more possible debanking situations taking place.
“The risk of debanking is ever-present irrespective of the latest news from Binance,” Bowler said, adding:
“That is reflective of the regulatory environment that we operate in or in this case, the absence of a regulatory environment.”
Bowler added this is the reason Australia needs “a proper regulatory framework” which she believes will reassure financial institutions about doing business with crypto exchanges.
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