Australian banks are studying blockchain after banning Bitcoin

     National Australia Bank (NAB) and Commonwealth Bank of Australia will take part in a joint project led by global financial innovation company R3 to design blockchain-based protocols, while the ACCC (Australian Competition and Consumer Commission) has begun investigating the closure of accounts related to the bank's bitcoin business last month.

The country’s two largest banks, National Australia Bank (NAB) and Commonwealth Bank of Australia, will join R3, along with more than two dozen other major banking institutions including HSBC and Citigroup, to explore how bitcoin’s underlying technology, the blockchain, can be used to improve and enhance some or all of banking operations.

The news comes after two banks decided to close all accounts related to Bitcoin startups and projects because all Bitcoin startups allegedly failed to fully comply with the banks' required KYC (Know Your Customer) and AML (Anti-Money Laundering) policies. All major Australian banks suddenly closed the accounts of these Bitcoin businesses without any prior notice.

The Australian Competition and Consumer Commission (ACCC) has begun investigating the banks' reasons behind the joint decision. ACCC chairman Rod Sims told the Australian Financial Review that the investigation was at an early stage and the organization is asking the banks to explain their actions.

"It's all under investigation. We've started talking to some of the bank representatives and are trying to get some information. It's still early days but it's ongoing. We're asking the bank why they did what they did and what the connection is," Sims said.

The ACCC investigation was requested by Australian Senator Matthew Canavan, who suspected that banks were closing bitcoin-related accounts because they were trying to avoid competing with emerging companies.

Canavan said :

We have strong laws that prevent some companies from erecting barriers to prevent them from competing with other companies. These laws are especially strong for companies that have significant market share and a dominant position in their markets.

Although the ACCC has launched an investigation into the banks and financial institutions involved, it will take several months to reach a conclusion. Before that, all Bitcoin-related businesses will not be able to use their bank accounts to conduct business with their customers and partners.