Just as my last blog on crypto regulation went to press, news broke that CBA (one of Australia’s “four pillar” banks) will be adding crypto assets to its mobile banking app. Add that to the launch of a crypto equities ETF by BetaShares, and further media coverage of local digital asset fund manager Apollo Capital, and you may start to believe that crypto is finally going mainstream in Australia.

But, before anyone gets too excited, a few caveats are in order.

First, the recent flurry of announcements from the Australian Senate, ASIC and AUSTRAC are simply the latest stages in a long-running debate about how crypto assets should be regulated, serviced and distributed. Despite these positive noises, there is still some way to go before crypto reaches critical mass (even though data for Australia shows we have one of the higher rates of market adoption).

Second, there is a lot of noise out there, and not all of it here in Australia. The SEC, FATF, ISDA, Cboe and SGX are just a few of the institutional voices making announcements on crypto and digital assets in recent weeks. On top of that, of course, there is the President of El Salvador (and the Mayor-Elect of New York) weighing in on behalf of the politicians. Some of this commentary is mere posturing; some is about being seen to be doing something; and a large part is just the legacy markets trying to catch up (and hoping to take control?).

Third, a closer look at CBA, BetaShares and Apollo Capital reveal some significant limitations in terms of what their products actually offer:

The CBA is planning to launch a trial among a small sample of their mobile banking users (although, no doubt, if things go well, it will be rolled out more extensively). But it does not mean the app becomes a fully-fledged crypto wallet: customers will only be able to buy/sell crypto within the app, and they won’t be able to send crypto to third parties. Plus, only a small set of crypto assets will be available.

The BetaShares ETF is not offering direct exposure to Bitcoin or other crypto assets. Instead, the fund is designed to invest in companies (mainly crypto exchanges, miners and technology providers) that are significant or strategic industry players. While that may mitigate the market volatility (and price fluctuation) that crypto experiences, it doesn’t necessarily make for higher returns.

The Apollo Capital fund is only available to wholesale or accredited investors – not retail customers. And while Apollo has done a reasonable job of growing its AUM, I don’t believe there are any major allocations from Industry Super Funds (which manage 27% of Australians’ retirement savings), Retail Funds (21%) or Public Sector Funds (18%). And despite anecdotal evidence that Self-Managed Super Funds (SMSF) are more active in crypto assets (along with Family Offices and HNWIs), recent data from the ATO suggests crypto assets held within SMSF are not much more than $200m.

Having worked in this industry since 2016, it’s always been apparent from an institutional perspective that few want to go first, but nobody wants to be last, when it comes to launching crypto products and services. Of the three Australian stories this week, the most significant is probably the CBA; it certainly got a lot of attention at the recent State of Play presentation by Blockchain Australia, in large part due to the industry implications, and how it will help bring crypto to an even wider audience.

Next week: Summing Up (and Signing Off)