HSBC Australia is to block payments from all crypto exchanges citing fraud.

Australia's international bank HSBC has informed its customers that it will begin suspending payments from customers' cryptocurrency exchanges as of July 24. It is the latest major bank to walk away from the sector, citing fraud.

“From July 24, 2024, HSBC will ban payments from bank accounts and credit cards that we reasonably believe are being made to kriptovalyutnyh exchanges,” HSBC Australia said on July 24 when it announced its “new security measures” to customers.

“If you want to make payments to cryptocurrency exchanges, you need to make alternative arrangements.”

To support its decision, HSBC cited data from the Australian Competition and Consumer Commission that showed Australians could lose up to $171 million to investment fraud by 2023.

While the bank apologizes for the change, its priority is to ensure that customers' funds are safe.

HSBC's move comes 12 months after Australia's “Big Four” banks — Commonwealth Bank, National Australia Bank, Westpac and Australia and New Zealand Banking Group (ANZ) — took similar steps to limit payments for cryptocurrency exchanges.

Australia's Bendigo Bank soon followed, citing the need to protect its customers from investment scams.

Amy-Rose Goody, managing director of the Digital Economy Council of Australia, told Cointelegraph that they had not been “preliminarily informed” of HSBC's decision.

“HSBC's recent decision to suspend all payments to cryptocurrency exchanges raises concerns about the challenges facing the relationship between Australian banks and the cryptocurrency sector.” Limitations affecting the digital currency community.

“It demonstrates the critical need for dialogue and improved regulatory frameworks that support innovation and effectively address potential risks.”

RELATED: Australia's top crypto lobby group ‘Blockchain' drops name

Without such a conversation, he said, many Australians would lose the “financial right” to participate in the growing digital economy.

By establishing “clear, fair and forward-thinking regulations,” Goody added, banks and industry players will be better placed to combat these frauds without curtailing innovation. The director added that the society has taken some steps since last year. DECA was added to the National Anti-Fraud Center Advisory Board.

HSBC said it will still accept customer payments from cryptocurrency exchanges and that banking will continue as normal.

HSBC Australia currently serves 1.5 million customers from 45 branches across the country.

Journal: Unstable Coins: Debasement, Bankruptcy and Other Risks Looming.