The Australian Transaction Reports and Analysis Centre (AUSTRAC) is testing the usage of blockchain to automate fund transfer instructions. As reported by ZDNet on February 24, the financial intelligence agency has teamed up with Swinburne University of Technology to build a blockchain-based prototype to test the potential of smart contracts helping multiple actors automate their international fund transfer instructions (IFTIs) reporting to Austrac. Banks, remitters, and casinos fall under AUSTRAC’s category of reporting entities.

The report also detailed that the proof-of-concept (PoC) between AUSTRAC and the university was commenced in December last year and is expected to last for around 12 months.

Moreover, apart from blockchain, the Australian agency is also exploring other technologies to automate IFTI reporting.

AUSTRAC’s partnership with the university geared as Swinburne, last month, launched a global Blockchain Centre of Excellence along with the IT consultancy firm Capgemini. According to the university, the center “will focus on advancing blockchain technologies, platforms, assets and systems to develop industry understanding and implementation of blockchain technologies.”

“We see this technology as the key digital innovation platform supporting global supply chains, intellectual property, and trade across a range of industry sectors in the future,”

Aleksandar Subic, Swinburne deputy vice-chancellor of research and development professor, said.

Licensing Crypto Exchanges

In Australia, AUSTRAC is responsible to oversee the activities of crypto exchanges. The agency, in April 2018, launched a licensing framework for domestic cryptocurrency exchanges to ensure AML and KYC checks. According to the local news platform ABC, 246 cryptocurrency exchanges have officially registered with AUSTRAC to receive the operating license.

“We will not hesitate to take strong enforcement action where significant or wilful non-compliance is identified,” an agency spokesperson said.

Blockchain Gaining Momentum

Though blockchain is not mainstream yet, many established financial institution is moving towards the decade-old technology. JP Morgan Chase recently revealed the ongoing development of JPM Coin to boost its settlement efficiency.

Last month, interbank payment and messaging network SWIFT announced the trial of a blockchain-based proof-of-concept for end-to-end payment tracking, payer authentication, and credit confirmation.

The views and opinions expressed in the article AUSTRAC Testing Blockchain to Automate Fund Transfer Messages do not reflect that of nor of its originally published source. Article does not constitute financial advice. Proceed with caution and always do your own research.

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