The Australian Parliament is considering a new bill that would criminalise the free exchange of money at large scales. If passed, Australians may be subject to a fine of $25k and jailed for up to two years if they pay more than $10k in a single transaction.
According to the Reserve Bank, the government’s proposed bill is meant to combat the “black economy“, not to eradicate cash use. Yet the bill has already generated a great deal of controversy, sparking concerns about the power and control that authorities and banks will have if it is indeed passed.
Matthew Lesh at the Institute of Public Affairs said that the bill represents a violation of people’s right to privacy and to the basic liberty of free exchange, and that it will enable the government to intrusively monitor and record digital transactions.
For context, the IMF reports that Australia’s black economy problem is already very low. The country is currently ranked 10th in the world by the IMF’s measurement, with the size of Australia’s black economy already shrinking in half between 1991 and 2015.
If this bill is formalised, it is an open question whether people will respond by shifting away from traditional financial institutions, and towards decentralised cryptocurrencies.
Cryptocurrency-based alternative payment platforms already allow people to conduct financial transactions without restriction, allowing anyone with a smartphone to send or receive cryptocurrency securely – without being automatically traced by financial institutions.
The Senate inquiry into this bill will submit its report by February 7 this year, but not without resumed public hearings.