Cryptocurrencies are ‘not a fad’ and will become an inherent part of Australia’s financial system, according to the government.
Jane Hume, the Minister for the Digital Economy, told the AFR Super and Wealth Summit that cryptocurrency was ‘not going away any time soon’ and must be embraced.
‘Don’t be the person in 1995 who said the internet was just a place for geeks and criminals and would never become mainstream,’ Ms Hume said.
Jane Hume, the Minister for the Digital Economy, said Australia must embrace cryptocurrency as a part of the financial system.
The minister’s embrace of cryptocurrency came just a week after the Reserve Bank head of payments policy Tony Richards said many regulators globally remain ‘sceptical’ of the currency alternative.
Dr Richards also questioned how widely cryptocurrencies were held in Australia, despite a recent Senate inquiry finding 17 per cent of Australians are investing in cryptocurrency.
But Ms Hume told the summit Australia must ‘forge our own trail’ on decentralised finance built on blockchain.
‘Decentralised finance underpinned by blockchain technology will present incredible opportunities – Australia mustn’t be left behind by fear of the unknown,’ the minister said.
‘If the last 20 or 30 years have taught us anything, it’s that all innovation begins as disruption and ends as a household name.’
Decentralised finance, or DeFi, does not use traditional banks, brokerages or exchanges.
Instead, blockchain-based systems are used to complete financial transactions.
The Australian government will become a central part of the nation’s financial system. Pictured is a promotional event in El Salvador to mark the usage of bitcoin in the nation.
Senator Hume commended those businesses which had embraced blockchain.
‘Just recently we’ve seen Commonwealth Bank move to allow its customers to hold and use bitcoin and other cryptocurrencies via its 6.5 million-user banking app,’ she said.
‘This will make CBA the first Australian bank – and one of just a handful of banks worldwide – to offer customers this sort of access.’
The federal government is yet to roll out regulations for these developments.