Regulated Bitcoin banking will disrupt Aussie finance sector says DigitalX
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The launch of regulated, global bank trading in digital currencies such as Bitcoin will be a disruptive game-changer, says Australian digital currency consultancy, Digital X.
DigitalX (ASX:DCC) was the corporate advisor to Europe-based Bankera, which recently closed an “initial coin offering” after raising €25 million ($37 million).
Bankera expects to have a banking licence within the next two years and will operate as a global, regulated bank offering traditional banking and investment services to the blockchain marketplace, including payments, loans, deposits and investments.
Blockchain is a technology that provides a public ledger of digital currency transactions . Each “block” is like a bank statement that is connected to other blocks to form a chain. Blockchain is best-known as the foundation for controversial digital currencies like bitcoin.
All Bankera’s services will support both traditional currencies and cryptocurrencies, such as Bitcoin — and will be available to customers globally — except US residents due to local regulation.
Bankera was a disruptor to the traditional banking sector and would bring more choice to Australian consumers, DigitalX chief Leigh Travers told Stockhead.
“It’s a global solution to banking, which means you can get the best rates on offer by using [Bankera] rather than being contained by local States; and Australians will be able to access that,” Mr Travers said.
While Aussie banks have been wary of digital currencies, Travers believes our banking sector’s “appetite for Bitcoin will change quickly” following the development of the Australian Digital Currency Industry Code of Conduct.
The new, self-regulated code was created by blockchain industry body, the Australian Digital Commerce Association (ADCA) — of which Travers is a founding member and current vice-chair.
“The new code means digital currency companies are now following the same compliance requirements as banks,” Travers says. “This includes reporting to AUSTRAC (the Australian Transaction Reports and Analysis Centre), which now recognises digital currency companies as real companies.”
In another boost to the FinTech sector, the federal government recently introduced a Bill to remove the double taxation on cryptocurrencies like bitcoin, which it says, “will make it easier for innovative digital currency businesses to operate in Australia”.
DigitalX, which listed on the ASX in 2014, expects a big boom in the digital currency space.
Its Bankera announcement came a day after it signed another, similar deal to provide corporate advisory services for an upcoming ICO for Etherparty, a platform that provides digital contracts for blockchain businesses.
DigitalX told Stockhead it will soon announce a partnership in the robotics and AI sector.
Earlier this month, the company signed a joint venture with ATM-maker Stargroup (ASX:STL) to add Bitcoin transactions to Stargroup’s 2900 ATMs across Australia.
DigitalX clocked up $US19,000 in sales during the June quarter, burning through $US444,000 and banking $US232,000.
The company is expected to spend more $US500,000 this quarter.