Cryptocurrency platforms Coinbase and OKX unveil novel SMSF services, aiming to penetrate Australia's substantial AUD 2.8 trillion superannuation market.
The Australian superannuation sector, currently valued at AUD 2.8 trillion, is seeing a significant shift as cryptocurrency platforms move to tap into this vast market. At present, AMP is the only major super fund with disclosed crypto exposure, but companies like Coinbase and OKX are making inroads, launching new services targeting Australia's self-managed superannuation funds (SMSFs).
The growth of crypto in SMSFs has been substantial. The share of crypto exposure has jumped to AUD 1.7 billion, up sevenfold since 2021. This trend is not surprising, as investors are using SMSFs to access crypto directly, outside of traditional fund restrictions.
Both Coinbase and OKX are helping users set up SMSFs by connecting them to accountants and legal advisors. These services cater to long-term investors rather than active traders.
The move into the superannuation sector comes as regulators maintain a watchful eye over the crypto market. The Australian Securities and Investments Commission (ASIC) and the Australian Transaction Reports and Analysis Centre (AUSTRAC) continue to oversee the sector, dismantling scam sites and enforcing compliance with anti-money laundering laws.
AUSTRAC has ordered Binance's local unit to appoint an external auditor due to concerns with compliance. Meanwhile, ASIC has disabled over 130 scam websites each week, many of which impersonate investment platforms or conduct phishing schemes.
Regulators have warned of crypto risks as exchanges push deeper into Australia's superannuation system. However, Coinbase and OKX expect mainstream crypto adoption to grow once regulatory clarity improves.
The superannuation system, which makes up a quarter of Australia's economy, was tested during the COVID-19 pandemic. Australians withdrew AUD 38 billion early without destabilizing the market, demonstrating its resilience.
As superannuation funds explore global markets for higher returns, including U.S. toll roads and Canadian ports, the entry of crypto platforms like Coinbase and OKX adds another layer of complexity and potential for growth.
OKX introduced a similar service in June and reports stronger-than-expected demand. Over 500 investors have already joined Coinbase's SMSF waitlist. Meanwhile, AUSTRAC is reviewing 427 inactive exchange licenses for potential deregistration.
The growth of crypto in superannuation is a testament to the evolving financial landscape in Australia. As regulations evolve and clarify, we can expect to see more crypto platforms entering this space, offering new investment opportunities for Australians.
