Bipartisan push for the Reserve Bank to back Australian bitcoin

August 8, 2017

by Eryk Bagshaw

Labor and Coalition senators have crossed the political divide to call on the Reserve Bank to embrace bitcoins as an official form of currency or risk the future competitiveness of Australia’s $145 billion a year financial services industry.

The push from Labor senator Sam Dastyari and Liberal senator Jane Hume comes after the digital currency soared to an all time high of $4070 per bitcoin on Monday, up from less than 10¢ per coin in 2010.

Senator Dastyari said when he first raised bitcoin in the Senate, one of his colleagues came to him and said: ‘I don’t get what the issue is, don’t they just melt all the coin bits they don’t use?”.

He said the digital currency had now become a serious financial player and Australia risked being left behind if it did not pursue developing its own official currency and blockchain to use on the market.

A blockchain tracks all transactions, owners and alterations made to a currency.

The chairman of the Australian Digital Currency Commerce Association, Ronald Tucker, said an Australian government backed crypto currency would eliminate settlement times and foreign currency exchanges.

 “It would be an auditor’s dream because you’ll be able to see any transaction that moves on it,” he said.Senator Hume said the development of a blockchain was the next major frontier in the technological revolution.

“The opportunities for government, academia, and the private sector are enormous,” she will tell an audience of 120 digital currency supporters in Parliament on Tuesday.

Until the May budget bitcoin was classified as an “intangible asset” by the Tax Office, which meant the Goods and Services Tax was charged twice during transactions, once on the product being bought and once on the bitcoin itself.

Nationals senator Matt Canavan has also publicly backed greater government support for the crypto currency.

“The question for Australia is are we going to follow or are we going to lead. We need to find a bipartisan way of doing this,” said Senator Dastyari.

“We can’t compete with our Asian neighbours when it comes to producing cheap goods and services anymore. We can compete when it comes to financial services but that is going to mean big, bold decisions.”

Financial services have become Australia’s biggest industry over the past decade, but banks have been reluctant to allow new players into the market.

In 2016, the Australian Competition and Consumer Commission cleared banks of any wrongdoing after they withdrew banking services to local bitcoin companies.

“This will be a revolutionary leap for the Reserve Bank and for Australian financial institutions, what we want to do here in Parliament is to create the political environment to allow that leap [for an Australian bitcoin blockchain] to occur,” said Senator Dastyari.

Source:  Bipartisan push for the Reserve Bank to back Australian bitcoin

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