In his letter, Senator Canavan expressed concern that the banks were putting the viability and potential of a dynamic Australian industry at risk to avoid competing with the emerging companies. On Monday he welcomed news of the ACCC investigation.

"We have strong laws against one business obstructing another business competing against it. These laws are even tougher for those companies that have the privileged position of a significant market share," Senator Canavan said.

Great responsibility

"Our banks wield great influence in the market and they have a great responsibility under our laws to not misuse that position. I am not sure if that has happened in this instance but there is no doubt that digital currencies do pose a threat to business of banks."

The wave of closures threatens the viability of the wave of new financial services businesses springing up to disrupt the existing sector. In August, a Senate committee found that bitcoin and other cryptocurrencies were becoming part of the mainstream.

Nationals senator Matthew Canavan wrote to the ACCC asking it to investigate the banks' actions. Jesse Marlow

Labor Senator Sam Dastyari, who chaired the Senate Economics References Committee into digital currency, raised concerns earlier that the bank account closures came as the big banks were taking an interest in using bitcoin and related blockchain technology. He was glad to hear that senators' concerns about the banks' actions would be investigated.

Senator Dastyari went up against bosses of the big four banks in April, when the Senate was holding an inquiry into financial advice. He said the ACCC should be prepared for the banks to defend themselves strongly.


"Banks must comprehensively and clearly explain why they are de-banking small digital currency companies while moving into the digital currency industry themselves," he said.

"The banks can put their mouthguards in and get in the ring, but all anyone has ever asked for is a credible explanation and I don't think they've got one ... If the banks are looking for another excuse to come to Canberra I'm only too happy to oblige them."

Senator Sam Dastyari says banks must explain why they are de-banking small digital currency companies while moving into the digital currency industry themselves. Jesse Marlow

Big four banks contacted by the Financial Review referred inquiries to industry body the Australian Bankers' Association.

Co-operate with inquiry

ABA chief executive Steven Munchenberg said the organisation had yet to hear from the ACCC about its investigations being formalised, but would co-operate with the inquiry.

Mr Munchenberg rejected the idea that the banks were acting to limit competition, and said bitcoin companies represented a risk to banks' compliance with anti-money laundering and counter-terrorism financing (AML/CTF) laws.

"We take every suggestion of anti-competitive behaviour incredibly seriously. It is a very serious allegation to make against the industry, so at this stage we will be focusing on proving that those allegations are totally unfounded," he said.


Australian Bankers' Association chief Steven Munchenberg says banks are not colluding against bitcoin companies but are concerned about the risk of money laundering and terrorism financing. Justin McManus

"Those suggestions are just nonsense. This is just banks making sure they are properly compliant to legal requirements."

Big United States banks were particularly wary about falling foul of anti-money laundering and counter-terrorism financing laws, after a number of big fines were handed out, and pressure was being put on Australian banks to ensure they were not associated with any questionable customers, he said.

Banking associations in Britain and Europe had spoken to him about similar issues with de-banking bitcoin companies elsewhere in the world while anti-money laundering and counter-terrorism financing concerns were addressed, and suggested some bitcoin companies were not making the effort to comply.

Need to provide evidence

"Those that are claiming that there is some sort of anti-competitive conspiracy will need to provide evidence that it is a global conspiracy, because these sorts of things are happening in other countries as well," Mr Munchenberg said.

"I have had proponents of virtual currencies coming to me over the last 12 months saying they shouldn't have to comply with AML/CTF legislation because it is terribly expensive and a terrible burden for them.

"If they adopt that sort of attitude it will only encourage the banks to be very worried about their attitude to compliance."