Australian Payment Provider Cuscal Imposes New Restrictions

Cryptocurrency Exchanges face new banking restrictions in Australia, prompting criticism and concerns from industry leaders.

Australian Payment Provider Cuscal Imposes New Restrictions

New baking restrictions were brought on cryptocurrency exchanges in Australia, by Cuscal’s partner Zepto. This move was criticized by Blockchain Australia.

Last month, Binance Australia was blocked by Cuscal from using Australian Dollar bank transfers through PayID. Meanwhile, Australia’s blockchain industry invited government stakeholders, and platforms like Cuscal, to discuss the issue on 27th June.

According to what CoinDesk discovered in the restrictions document titled “Zepto Compliance Survey for Digital Currency Exchanges (DCE)”, the document reads:

"Our banking partner, Cuscal has updated its Merchant guidelines which contain new requirements for all digital currency exchanges that are supported by Cuscal. If you do not currently comply with the new requirements, we are happy to consider a reasonable time frame for implementation. Please note, if you are unable to comply with the requirements, Zepto and Cuscal will not be able to continue to support you."

According to Zepto's "survey," the exchanges were instructed to implement suitable safeguards against fraud for their users, with a deadline for response set on June 21.

As per the statement by Blockchain Australia, the stipulated requirements include a mandatory 24-hour hold on initial inbound payments of any size, real-time verification of user identity, and undisclosed transaction limits on cryptocurrency exchange payments.

The statement entails the following:

"The new requirements appear to only be targeted to digital currency exchanges. Blockchain Australia supports efforts to enhance and promote secure digital transactions while still preserving users’ freedom to decide how to spend their own money and use their assets."

Around 400 crypto exchanges are registered for counter-terrorism and anti-money-laundering financing obligations in Australia. Unfortunately, due to data privacy, it is unknown how many of them are provided payment services by Cuscal and Zepto.

The chair of Blockchain Australia and a digital assets lawyer, Michael Bacina said that "the move will have a major impact in Australia."

“In a time of growing economic uncertainty, scams and fraud across the economy are expected to increase. Australians rightly expect businesses they deal with to pitch in to help tackle this problem, but they also expect to be able to spend their money and use their assets as they choose, without undue restrictions."

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