White says because payment fraud is becoming more difficult to perpetrate, criminal groups are turning their attention to other kinds of activities, a shift that is reflected in an overall increase in scams.
Delia Rickard, ACCC deputy chair, said in her preface to the Targeting Scams report 2021 that the “popularity and hype” of cryptocurrency has led to a surge in losses to related scams.
“[Crypto] is becoming the preferred method of payment across all types of scams,” she says.
Crypto scams can involve anything from fake digital currency investments to sham crypto wallets or bitcoin-stealing malware.
It can also involve paying for goods with crypto that never turn up, and theft via computer hacking. Because of the anonymous nature of crypto, ransomware often demands payment in bitcoin.
“In March 2022, the Australian government began consultation on approaches for licensing digital currency exchanges and custody requirements for crypto assets,” Rickard says.
“While ongoing, I am hopeful that this and other regulatory measures will slow the growth of cryptocurrency scams,” he says.
AusPayNet’s White says there is a recognition by the new federal government that crypto needs to be regulated, just like any other financial service.
“If you [are a bank] processing a payment, whether that payment is in Australian dollars or bitcoin… it should be regulated in the same way,” White says.
Reputable crypto exchanges want to be regulated, he says. Protecting consumers is, in large part, about the regulatory set-up, White says. “That will help every player in the ecosystem – the consumer can have more trust of dealing with a reputable exchange, as it is licensed, and banks will be able to better assess the exchanges.”