Coinbase challenges Australia’s Big Four banks for targeting crypto and fintech firms

Coinbase has accused Australia’s largest banks of systematically restricting access to basic financial services for crypto and fintech firms. In a submission to the House of Representatives Standing Committee on Economics, the Nasdaq-listed exchange stated that debanking now poses a direct risk to competition, innovation, and public trust in Australia’s economy.

The exchange stated that banks are increasingly shutting off lawful businesses and individuals by closing accounts and imposing limits on transactions with digital assets.

According to Coinbase, these moves are no longer isolated compliance decisions but coordinated policies to restrict how people use their own money.

Banks tighten controls as crypto rules advance

Coinbase said that the Big Four banks – Commonwealth Bank, Westpac, ANZ, and National Australia Bank – have control over the majority of transaction accounts and payment rails. As a result, account closures can be a way to exclude businesses from the formal economy.

The company said such outcomes are more akin to an indirect regulatory ban than to routine risk management.

The submission stated that the banks relied heavily on anti-money laundering and counter-terrorism financing requirements to justify closures. However, Coinbase warned that customers often do not receive a clear explanation, a notice period, or access to dispute resolution.

Over time, this lack of transparency has eroded confidence in the financial system, particularly among fintech users and small businesses.

Coinbase also cited data that, as early as 2021, as many as 60% of fintech firms in Australia had been denied banking services. The exchange said that the issue has not been resolved, despite repeated inquiries and public commitments by policymakers.

The complaint comes as Australia looks to tighten oversight of crypto platforms. Proposed legislation would impose the burden of an Australian Financial Services Licence on major exchanges, resulting in a new compliance cost.

Lawmakers face pressure to enforce transparency rules

The exchange urged lawmakers to act on five transparency measures recommended by the Council of Financial Regulators based on a Senate inquiry. Although the government had backed such measures in August 2022, they were never legislated.

The proposals would require banks to document the reasons for de-banking, share the reasons for debanking with the affected customers, provide access to internal dispute resolution, give at least 30 days’ notice before closing core accounts, and self-certify their compliance with the framework.

Coinbase argued that these measures would provide a balance between controls to prevent financial crime and fairness and due process.

The treasury has acknowledged the issue in previous consultations and said it was working with banks and industry groups to increase transparency. However, Coinbase said that voluntary engagement has not achieved meaningful change, given the amount of market power held by the largest lenders.

The exchange said ongoing debanking puts investment and reduced consumer choice at risk and undermines Australia’s reputation as a regional fintech hub. It also said that inconsistent access to banking services makes compliance difficult, not that it increases safeguards.

Coinbase pointed to overseas models, where access to basic banking is protected. In the European Union, legal residents have a basic account guaranteed. In Canada, banks are required to open accounts for most applicants, including those without jobs or with prior bankruptcies.

In the United States, political scrutiny has increased following federal action to prevent viewpoint-based and crypto-related debanking. Coinbase said these developments are proof of an emerging international consensus that access to finance should not be limited without legitimate cause.

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