Coinbase, a prominent global cryptocurrency exchange, plans to develop a service specifically for Australia’s self-managed pensions sector. The integration of cryptocurrency into the pensions sector, particularly self-managed super funds [SMSFs], is not a recent development. Since March 2019, there has been a notable rise in the inclusion of crypto assets in Australian SMSFs. The firm’s Asia-Pacific Managing Director, John O’Loghlen shed light on this development.
The latest figures from Australia’s Taxation Office indicate that nearly 1 billion Australian dollars is now invested in cryptocurrencies within these funds. This is a significant jump from 197 Australian dollars in December 2019. However, the volatility and risks associated with cryptocurrencies have resulted in considerable losses for some investors. A March 2023 report from Reuters highlighted that thousands of Australians with SMSFs investing in cryptocurrencies have collectively lost millions.
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Coinbase’s New Initiative
To address this growing interest, Coinbase is developing a specialized service for SMSF investors. The firm pointed out that these funds often make a single, long-term investment, underscoring the need for a service that supports this investment approach. O’Loghlen said,
“Self-managed super funds might just make a single allocation, set it and forget it. We are working on an offering to service those clients really well on a one-off basis—to have them trade with us and stay with us.”
The rising interest in cryptocurrencies among SMFSF investors can be linked to the overall momentum in the crypto market. This comes particularly following recent spot-ETF approvals in the U.S. This trend is expected to continue, with potential similar approvals in Australia this year. However, O’Loghlen clarified that Coinbase does not see this initiative as competing with ETF providers. Rather, it aims to leverage the growing interest in cryptocurrency investments.
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