Cryptocurrency Exchanges in Australia Prioritize Communication to Combat Scams

Industry Leaders Stress Importance of Communication at Fintech Conference

Cryptocurrency exchanges in Australia are taking proactive measures to prevent scams by prioritizing communication with their users. According to executives from major crypto firms, including Cointree, CoinSpot, and Swyftx, this communication is essential in breaking trust between victims and scammers.

During a panel discussion at the Intersekt 2023 fintech conference in Melbourne on August 31, the executives outlined various measures implemented by their platforms to protect users from fraud. These measures include both automated and manual Anti-Money Laundering checks, investigations, education, and communication.

Talking to Customers: an Effective Approach

Jedda Stocks-Ramsay, AML officer at CoinSpot, highlighted the company's focus on engaging in conversation with its customers. Stocks-Ramsay stated that they speak to their customers at least once during their time with the exchange, as this has proven to be highly effective in preventing scams. By discussing scams openly, CoinSpot aims to address the social engineering aspect utilized by scammers to build trust with victims.

Stocks-Ramsay explained that scammers often spend considerable time on the phone with victims, but a simple email from the exchange can help users avoid falling victim to these schemes. By providing a human element and encouraging users to question trust, exchanges can disrupt the scammer's tactics.

Education as a Key Component

Jason Titman, an executive at Swyftx, emphasized the importance of education in protecting cryptocurrency users. He highlighted that lack of education often makes individual consumers susceptible to disclosing personal information and passwords to scammers.

Titman noted that educating customers has always been a priority for their platform, particularly in light of the evolving nature of the cryptocurrency industry. He believes that by providing relevant and important information, users can become more resilient to scams.

Scams Extend Beyond Cryptocurrency

The panel speakers also emphasized that scams are not limited to the cryptocurrency industry alone. Stocks-Ramsay pointed out that cryptocurrency scams involve various industries, including social media, banks, telecoms, and others. She stressed the importance of educating users about scams in different sectors to enhance overall awareness and protection.

Jess Renden, CEO of Cointree, echoed this sentiment and defended the cryptocurrency industry against blame for scams. Renden highlighted the proactive approach taken by Australian crypto firms in working with regulators and other businesses, such as telcos and social media platforms, to protect customers.

Increasing Losses and Scam Prevention Efforts

The focus on communication and education comes in response to increasing scam losses in Australia. According to data from the Australian Competition and Consumer Commission, investments involving cryptocurrency as the payment method resulted in losses of approximately $150 million in 2022, a staggering increase of over 160% from 2021.

The push for improved communication and user protection follows recent arguments by major Australian banks that 40% of scams involve cryptocurrency. These arguments were made to justify the decisions of certain banks to restrict certain crypto transactions in June 2023.

Additional reporting by Tom Mitchelhill, Cointelegraph author.