According to the report published by the Financial Review on 12th July, the Australian Bank of Queensland has issued a ban for property buyers to prevent them from using home equity to trade on cryptocurrencies. It has justified its move by citing the possibility for high risk involved in the trading of cryptocurrency. It is of the opinion that leveraging on the cryptocurrency trade can be lucrative but very risky at the same time and a single wrong decision can prove devastating.
Reports also suggest that the bank will make use of a line of credit from loans for the trading of cryptocurrencies. The bank is overhauling the loan structure, and warning customers that any loan which is done on the basis of cryptocurrency is not acceptable.
As per normal rule, people can take a loan to buy a property or buy cryptocurrency with the help of using redraw features whereby they could borrow additional amounts of money to their loan accounts if the loan amount exceeds minimum required payments.
As told by Financial Review, the interest rate of offering loan varies in the country and usually, there is no fee involved in situations where the request to redraw money is submitted online. The popular method of using a line of credit to buy cryptocurrencies or to take a loan will help borrowers to draw on a line of credit using property equity like an ATM.
Further, the Financial Review published news that the bankers in the country are inquiring and tracking borrowers accounts to alert them of risks which may arise in cryptocurrency trades and funds transfer. The brokers in the country are worried because the Treasury, the Australian Taxation Office, the Reserve Bank of Australia and Austrac are all inquiring after the recommendation came.
However, if reports are to be believed, some of the lenders are still regulating crypto-loans, though they never ask consumers how they use borrowed amounts.
No doubt, the Australian government is going very strict over the regulation of crypto measures. As confirmed by some Australian tax experts, the Australian Taxation Office (ATO) is going to take harsh measures on crypto investors this year.
As opined by a senior tax agent, ATO wants a free and fair game just to make sure all the crypto investors pay the right amount of taxes. They want all Australians to pay taxes owed in any sort of dealing in digital currency.
The country is making stringent rules when it comes to dealing in digital currency. Last April, the government made a recommendation that all digital currency exchanges must abide by the new rule of anti-money laundering. This new rule demanded that all dealings in cryptocurrency should be duly registered with the authorities and must undergo various reporting and identity checking procedures.
This ban on crypto trading is an important move when it comes to the authentication of cryptocurrency in the country and it poses a serious question mark about the future of digital currency in the country.