Do Australian Banks Accept Bitcoin?

Last Updated on July 14, 2023 by Kevin Groves

Australian banks and cryptocurrency have a bit of a rocky relationship. Banks and other traditional financial institutions have long been digital currency’s staunchest opposers. As the blockchain industry has evolved over the past decade, banks are finding it more and more difficult to deny crypto’s role in the future of finance. Blockchain tech and virtual currencies are firmly entrenched in society, and banks are beginning to broaden their horizons. 

In Australia, there’s a spectrum of what banks accept when it comes to Bitcoin, however, very few directly accept Bitcoin as a transaction medium. There are still a few holdouts that will block large transactions related to digital currencies. In contrast, some banks such as Commonwealth Bank of Australia have indicated their support for the in-bank trading of Bitcoin.

Disclaimer: Please keep in mind that banks can change their stance toward crypto at any given time. While most banks today do not accept Bitcoin, this information can quickly change.

The Big Four Australian Banks: Stances On Cryptocurrency

Commonwealth Bank of Australia (CBA)

The Commonwealth Bank of Australia is the country’s biggest financial institution, servicing over 16 million customers. The popular bank is one of the only places in Australia that fully supports Bitcoin. In late 2021, CBA announced a partnership with the cryptocurrency exchange Gemini and blockchain developer Chainalysis. These services have been integrated with CBA’s CommBank app, so customers can buy, sell and trade crypto assets directly via the bank such as Bitcoin (BTC), Ethereum (ETH) and Litecoin (LTC). To date, no other bank in Australia offers this service.

Commonwealth Bank will likely continue to expand its product as the crypto service continues its rollout. The addition of a crypto interest earning platform is likely high up on the priority list and would work similarly to a CBA high-interest savings account. CBA is also very interested in supporting tokenisation, as a way of improving liquidity for real-world assets. However, for the time being, the CommBank cryptocurrency product has encountered a few snags and is yet to be fully released to retail investors. 

Commonwealth’s Australia-first stance on cryptocurrency has been spurred by a few factors. Research conducted by the company’s team discovered that a substantial number of their customers – particularly the 18-39 age demographic – were already considering using Australia’s best crypto exchanges. However, due to the lack of regulation and untrustworthiness, some had steered clear of owning Bitcoin – until now. CBA wants to provide this demographic with a regulated, reliable way to buy Bitcoin and safely store it. 

If digital currency is to revolutionise the world, banks like CBA will have a large role to play in its safe, widespread adoption.

Westpac

Westpac is one of Australia’s “big four” banks and services millions of clients across the globe. As of September 2022, Westpac does not directly support the transaction of Bitcoin to and from the bank. Customers cannot store BTC, or other digital currencies, in their Westpac banking account. 

However, you can use funds from your Westpac accounts as a deposit to third-party exchanges that accept AUD. On our testing, we found that Westpac does not block instant OSKO transfers from an everyday transaction account to Swyftx and CoinSpot. Some customers have claimed that, in the past, Westpac has prevented finalising transactions to certain crypto exchanges, but we have not encountered this in our experience. 

Westpac was one of the more progressive Australian banks when it came to working alongside cryptocurrency. Their venture capitalist team was one of the biggest supporters of Coinbase Australia and purchased a major stake in the company in 2015. By 2021, the profits of this venture were a whopping half-billion AUD. The bank is also regularly exploring the potential of offering digital currencies to its customers. It opened a role in the company for a full-time crypto architect in early 2022. Where this commitment will lead is yet to be announced.

For a tutorial on how to buy crypto in Australia with Commbank, read this article.

Australia and New Zealand Banking Group (ANZ)

ANZ offers millions of Aussies a huge range of financial services. ANZ has a complicated relationship with cryptocurrency that stretches back to 2017. Around this time – coinciding with the crypto market’s massive bull run – the bank considered rolling out a crypto product that allowed its customers to buy and sell digital currencies via the institution. 

Ultimately, ANZ went in a different direction to this idea and to date has no plans of accepting Bitcoin and other cryptocurrencies. Historically, ANZ has reportedly blocked transactions or closed customers’ accounts that frequently use crypto-related services. This policy was amended as the market for crypto became impossible to ignore, and ANZ no longer prohibits its customers from using funds to buy crypto in Australia. 

Furthering the complexity of ANZ’s relationship with crypto, the bank was the first in Australia to mint its own stablecoin based on the Australian Dollar, the A$DC. The primary purpose of A$DC is for institutions to send large lump sums (tens of millions) within minutes instead of days. A dollar of AUD backs each dollar of A$DC. 

Ultimately, ANZ’s stance on crypto is rather nuanced. The company is quite blockchain-friendly and has implemented elements of the technology into its products (as we can see with the stablecoin release). However, ANZ has shown minimal interest in offering its retail customers any way to store, buy or deposit Bitcoin via the bank.

National Australia Bank (NAB)

The National Australia Bank (NAB) is one of the nation’s most-renowned financial providers, servicing millions of customers in dozens of countries. NAB is not necessarily anti-cryptocurrency; however, it has been criticized for its unwillingness to explore the sector. Although no policies preclude it, NAB has been extremely wary of partnering with any crypto-related businesses. 

Therefore, NAB does not accept Bitcoin and does not support its customer’s buying, trading or storing any digital currency through their bank accounts. However, clients can still fund their crypto trading accounts using AUD held with NAB. There are not, and never have been, any policies that prevent NAB retail customers from dealing with cryptocurrency service providers like Swyftx or eToro Australia.

In a bullish sign for crypto enthusiasts, NAB has begun using blockchain technology as part of its operation. Just like ANZ, the bank is in the process of creating and minting an AUD-pegged stablecoin. This stablecoin will form the basis of a decentralized marketplace known as Carbonplace. Big businesses looking to exchange carbon credits will use the environmentally-conscious platform. The stablecoin will be used to execute transactions on Carbonplace.

Australian Banks With Unique Stances On Crypto

Bendigo Bank

When it comes to crypto, Bendigo Bank has one of the toughest stances of any bank in Australia. The company does not do business with clients heavily invested in the transaction or use of virtual currencies. Professional crypto traders and businesses have been denied using or opening Bendigo Bank accounts to conduct their trades. 

However, most individual investors should have no problem purchasing Bitcoin or other digital currencies via a reputable exchange. It’s possible that Bendigo Bank may prevent high-net-worth investors from making extremely large or frequent transactions.

HSBC

HSBC isn’t an Australian-only bank, however, it does serve thousands of customers in the country. HSBC is known for being perhaps the most anti-crypto bank in the world. The company has a history of freezing accounts that make transactions with international, unregulated exchanges – for example, KuCoin. In addition, HSBC customers using the bank’s investing platform aren’t allowed to purchase equity in companies operating in the virtual currency space, such as Microstrategy.

Volt Bank 

Volt Bank was a short-lived “neobank” that set out to disrupt the current rigid environment in financial institutions. Unfortunately, in 2022, the bank went out of business due to a lack of finances. However, they are worth mentioning as Volt committed to accepting Bitcoin for storage, sale and purchase before their liquidation. No other smaller bank has followed suit, but it’s possible they will soon to gain a competitive advantage over other, larger institutions.   

Other banks

If your bank has not been listed in this guide, it’s always a good idea to double-check the bank’s policy yourself. You can easily do this by visiting their website. However, as of this article, you can assume the following for most banks not mentioned in this article:

• Australian banks do not accept Bitcoin. You cannot deposit, buy, trade or sell Bitcoin directly through a bank.
• Individual Australian investors can use their bank account to deposit funds to a crypto exchange for the purchase and transaction of digital currencies. 
• Professional traders and other crypto-related businesses may have their accounts frozen, however, the specific policy will vary between banks.

Why Are Banks Opposed To Crypto?

Certain institutions (in particular central banks and federal reserves) have considered the minting of regulated, privatized cryptocurrencies. Essentially, these coins would operate as a digital fiat currency. Some banks have already released their own stablecoins to help settle large transactions.

However, a widespread, national cryptocurrency is likely many years away (if ever). Most banks in Australia and worldwide are still reluctant to offer crypto-related services to their customers. There may be a few reasons for this – some speculative, others risk-based. 

Regulatory issues

Banks are generally unwilling to take on anything too risky when it comes to finances. As crypto is new, mostly unregulated, and in a legal grey area, banks tend to avoid it. Setting up a crypto trading platform comes with all sorts of hoops for the banks to jump through, and in many cases, the potential profits are simply not worth the effort.

Bitcoin and other cryptocurrencies are still relatively new phenomena. Consider that fiat (government-issued) currency has been around for over a millennium, and you can see that digital currencies have a lot of catching up to do. There simply isn’t enough historical data for governments and other institutions to implement suitable regulatory frameworks. 

In addition, blockchain-based coins are intended to be out of regulatory reach. This creates a dilemma for governments and banks – should we regulate crypto and betray one of its core philosophies? Or should we leave regulations loose as intended, but ultimately harm Bitcoin’s adoption? Authorities are still trying to figure out the best answer to this question. Until then, it’s unlikely the majority of banks will accept direct Bitcoin deposits and withdrawals.

Volatility

Cryptocurrency markets are notorious for experiencing swings of 20%+ overnight. This is a major factor in many banks not implementing rigorous support for digital currencies. Such major fluctuations can make it difficult for banks to assess loans and other valuations properly.

In addition, cryptocurrency not being backed by a physical asset is an issue that can ward off risk-averse financial institutions. 

Disruption of the current financial system

Take a look at the current economic makeup of society. It’s easy to see that banks have it pretty good – they are some of the largest businesses in the world, controlling much of the population’s wealth. 

Cryptocurrency has the potential to disrupt the present economic landscape and force banks to adapt or falter. Greater sovereignty over self-wealth, superior earning products and cheaper international transactions are all elements of crypto that would directly affect bank profits. Therefore, it’s reasonable to suggest that it’s not in most banks’ best interests to support cryptocurrency, at least at the current stage of its evolution.

Is Bitcoin Considered Legal Tender In Australia?

No, Bitcoin is not accepted as legal tender by the Australian government.

Legal tender is a currency or asset regulated by the government that society can use to pay off any debt. Mostly, this definition refers to taxes, but can also include contracts and legal fees. In Australia, the Australian Dollar (AUD) is an example of legal tender.

Some other nations have considered and even implemented Bitcoin as a legal tender. In 2021, El Salvador legislated BTC as the nation’s native currency, meaning residents could use it to pay crypto taxes, buy a house or dine out at a restaurant. 

It’s extremely unlikely Australia will denominate a cryptocurrency as its native currency, at least in the current economic climate. However, it’s not impossible that Australia considers Bitcoin a legal tender in the future. In this hypothetical scenario, most banks would accept Bitcoin deposits and withdrawals. 

There are even a few places in Australia that accept transactions in Bitcoin – both digital and brick & mortar merchants. Check out our guide on who accepts Bitcoin in Australia and where you can spend it.

Conclusion

The combination of the ever-evolving regulatory landscape and how Australia’s major banks and financial institutions perceive the role of Bitcoin in today’s society poses challenges to its further incorporation as a transactional medium. Initially, the majority of Australian banks resisted Bitcoin. However, stances are becoming slightly more favourable as Bitcoin’s incorporation into mainstream society increases. Currently, only the Commonwealth Bank of Australia allows you to actively buy and trade Bitcoin through its mobile banking app.

Related: What are the best crypto debit cards in Australia?