Commonwealth Bank customers will soon be able to access cryptocurrency through the CommBank app as part of a pilot program that the bank plans to roll out more broadly in 2022.
The announcement on Wednesday makes CBA the first Australian bank to fold crypto exchange and custody services into a broader suite of traditional banking services, in a bid to compete with challengers like PayPal, who have made similar moves.
Customers included in the early stages of the pilot program, which will begin in “the coming weeks”, will have immediate access to up to 10 crypto assets including Bitcoin, Ethereum, Bitcoin Cash and Litecoin.
As part of the program, CBA has partnered with global crypto exchange Gemini and blockchain data and analytics firm Chainalysis to integrate the product and compliance infrastructure required to streamline the offering at scale.
CBA CEO Matt Comyn said the announcement emerges in response to surging appetite for crypto investments among the bank’s customers, who have long been calling for integration.
“We believe we can play an important role in crypto to address what’s clearly a growing customer need and provide capability, security and confidence in a crypto trading platform,” Comyn said.
“In looking at ways that we can support our customers, we have made the strategic decision to form an exclusive partnership in Australia with Gemini, a global leader wit strong security and a track-record of serving large institutions,” he said.
“CBA will leverage Gemini’s crypto exchange and custody service and integrate it into the CommBank app through APIs.”
Dave Abner, global head of business development at Gemini, said the partnership is likely to set a new standard for other banks that follow CBA’s lead.
“We are proud to be providing exchange and custody services to CBA as they begin to unlock access to cryptocurrency investments for many Australians,” Abner said.
“The exponential growth of digital assets internationally, coupled with Gemini’s institutional-grade security and proactive regulatory approach, positions this partnership to set a new standard for banks and financial platforms in Australia and across the globe.”
Meanwhile, Chainalysis’ role in the deal is set to shore up the program’s security infrastructure, and offer the bank the framework to ensure it complies with regulatory requirements.
Chainalysis CEO and co-founder Michael Gronager said the program sets significant precedent for the financial services industry, where banks are set to play a key role in normalising retail crypto investing, safely.
“Financial institutions like CBA play an integral role in growing cryptocurrency adoption safely,” Gronager said.
“We are thrilled to be a part of this important alliance with CBA and our partner Gemini to play a pioneering role in building trust in cryptocurrencies in the Australian market.”
Comyn said CBA’s new program will go a long way in building that trust, as fraud risks and regulatory fears continue to deter first-time investors who would otherwise be interested in buying into the space.
“Customers have expressed concern regarding some of the crypto services in market today, including the friction of using third party exchanges, the risk of fraud, and the lack of trust in some new providers,” Comyn said.
“This is why we see this as an opportunity to bring a trusted and secure experience for our customers,” he said.
“We remain committed to reimagining banking and will continue to bring more functionality into the CommBank app including investing and shopping.”
The announcement offered cause for early celebration across all corners of the market on Wednesday. BTC Markets CEO Caroline Bowler said the move should be seen by regulators as “yet another red letter day” for crypto in Australia.
“CBA’s move is exciting and inevitable. It’s yet another ‘red letter day’ for crypto and it is as though Australia has suddenly put the lead foot down,” Bowler said.
“We have been touted as playing catch up all this while, but now we’re moving into a leadership position globally with our largest bank, and one of the most significant mainstream financial institutions in the world offering millions of customers access to cryptocurrencies,” she said.
“With regulation in the offing and the largest bank in the country allowing it, the floodgates are now open for more appetite from traditional finance and smart money to move into cryptocurrencies.”