Crypto is Inevitable so is KYC-AML Rules, Australia Crackdown


traders in Australia who have some dark corners in their closet have a reason
to worry. The tax man has vowed to flash them out.

The tax authority in the country, Australia Tax Office (ATO), has indicated they will be conducting data matching where virtual currency exchanges will surrender traders’ data. They will then cross match the details with the details reported by individual taxpayers to establish any discrepancies.

Financial Firms Participated

2018, a similar activity was carried out with leading traditional financial
firms, and more than 600 million transactions were cross-checked. This year,
ATO is widening the net to include crypto exchanges.

According to Will
Day, Deputy Commissioner of the ATO:

“The ATO uses third-party data to improve the integrity of the tax system by identifying taxpayers who fail to disclose their income details correctly. We also use third-party data to assist taxpayers in meeting their tax obligations through pre-filling of tax returns.”

is likely looking to get a share of the profits from more than 500K crypto
traders/investors in the country.

everything is planned to run smoothly, those who have been filling misleading
tax information will have to face the ATO. However, before action is taken upon
alleged defaulters, the tax man will allow the traders to verify the available

For those who already know they have some skeletons in their closet, “they should contact the ATO as soon as possible.” Not for the tax to be waived, but for the penalty to be reduced.

Will Global Exchanges Comply?

developments took center stage on social media platforms with some arguing that
only a few virtual currency exchanges operate in Australia so no much of a
problem. Additionally, the online crypto community was still optimistic that
while the ATO is going after tax evaders, the government has a positive
attitude towards Bitcoin and other virtual currencies.

the community was undecided on whether leading global exchanges will be
compelled to share traders’ transaction data.

example, a Redditor

“There’s always a few [exchanges which operate in Australia]. They sure as f*** aren’t getting like Binance/Bittrex etc. to give user details in a blanket sweep like that.”

with the traders almost confident that leading crypto platforms won’t surrender
the data, “if they accepted direct deposits/withdrawals of fiat it might be

fear that since Bittrex, a leading virtual currency exchange, operates in the
USA, “ATO will have arrangements with IRS and protocols to share data.”

More Than $7,500 in Cash

ATO’s move coincides with the Australian government’s move to limit cash transactions to a maximum of $7.5K. This, as per the government, is meant to stir a digital revolution while increasing government revenue especially from cigarettes.

most transaction conducted digitally, financial authorities in the country will
have better control on tax evasion, money laundering, and other criminal
activities which are fueled by cash transactions.

limit order will take effect on July 1. While the government seeks to curb
illicit activities involving large sums of money, legitimate businesses will be
phased out.

example, Paul Thomas of Commander Security Service based in Sydney said:

“It’s going to screw me – 95 percent of my business is cash collections… we could process and move up to $4-5 million – picking cash, processing, and EFT-ing it to customers’ accounts.”

Do you think
will be a trigger for DEX migration?