Does Australia’s $10,000 cash payment limit bill apply to cryptocurrency?
In a nutshell, no. The Restrictions on the Use of Cash Bill does not apply to cryptocurrency.
In the 2018-2019 budget, the Australian government announced it would introduce a nationwide cash payment limit of $10,000 for payments made or accepted by businesses for goods and services. Transactions of $10,000 or more would need to be made using electronic payments of cheque. On 26 July, the draft bill was published.
The purpose of this measure is to help tackle tax evasion and other criminal activities.
But where does cryptocurrency come into it? If crypto transactions are treated as a cash payments, that limit of AUD$10,000 (0.72 BTC) could severely crimp the industry's ability to move cryptocurrency without inadvertently falling afoul of the laws. Since the bill's reveal, people have been airing concerns about this issue, especially in light of the bill's statement that despite being electronic, cryptocurrencies are still more akin to cash payments.
"Some forms of electronic payment more closely mirror physical currency," it says. "In particular, crypto-currencies and other digital currencies are generally unregulated and do not create clear records of transactions in a form that can easily be used to identify the parties to a transaction."
However, as the bill currently stands, it does not impact cryptocurrency payments.
Conditions do not apply
Cryptocurrency is not considered cash for the purposes of the bill. It does not count towards the $10,000 limit, and even if a payment is partly crypto and partly cash, it still doesn't apply unless the cash portion is $10,000 or more.
Crypto is not cash. Conditions do not apply.
"Digital currency is a new and developing area in the Australian economy. Unlike physical currency, it does not have a firmly established regulatory framework or industry structure. This makes it difficult to apply the cash payment limit in a way that would not largely prevent the use of digital currency in Australia or significantly stifle innovation in the sector," the bill's explanatory materials note.
"At the same time, there is little current evidence that digital currency is presently being used in Australia to facilitate black economy activities," it continues.
"Given this, the Government has decided at the present time to effectively carve digital currency out from the cash payment limit."
Digital currency is simply not covered by the bill. However, it is subject to change.
"This position will remain under ongoing scrutiny to ensure that the exemption for digital currency payments remains appropriate in light of the current use of digital currency in the Australian economy."
Disclosure: The author holds BNB and BTC at the time of writing.