On Tuesday night, the Australian government budget announcement brought news of a ban on physical cash transactions above $10,000 AUD from 1 July 2019.

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So obviously there are big individual liberty and privacy concerns that 95% of Australians do not give a shit about, but let’s list some of them anyway:

  • This will not stop here, it may be a $10,000 limit for now – but it will come down over time. One day, it’ll move to $5,000. Then, $2,000. Eventually, every fiat dollar spent will be digital and traceable.
  • It will seriously impact your privacy in ways that we can’t even fully appreciate yet. What if you have an illness that you want to treat without tipping off other people? What if you wanted an abortion and needed some level of confidentiality for that spending? With the level of data analytics and data mining out there now, who knows if the next ‘Cambridge Analytica’ is some company data mining your transactions and selling it to other parties e.g. Insurance companies, banks, other financial institutions?
  • As fiat money slowly becomes entirely digital, it enables a whole new level of financial horrors: such as negative interest rates, or other forms of confiscation such as bail-ins for depositors at banks.

Now obviously the more the government moves down this path, the more it pushes people to alternatives.


At first, I anticipate we’ll see more people attempting to split up their transactions >$10,000 AUD into smaller pieces such that it goes below the threshold e.g. 2 x $5,000 transactions. But remember, with all the recent focus on Banking and AML compliance – Banks will have even more focus on them by the regulator to conduct transaction monitoring and identify possible instances of structuring.

Also, as mentioned above, if you think the $10,000 limit will stay at $10,000 forever, you are sadly mistaken. This limit will come down over time, making it harder and harder for people to ‘structure’ their transactions and remain undetected by transaction monitoring.


Over time, more and more people will be driven into using Bitcoin. While the use of cryptocurrencies is not anonymous, at least they are much harder to centrally confiscate or control. There are methods that can be used to ‘stonewall’ chain analysis and obfuscate the trail, so to speak. For example, see the Samourai bitcoin wallet blog post here. Through analysing Bitcoin’s blockchain, an attacker may be able to connect ownership of addresses together.


To which the Samourai wallet developers have introduced a method of obfuscation, known as STONEWALL.


Also, there are potential privacy technologies and improvements coming down the wire for bitcoin. For a quick overview on some of these, such as Schnorr signatures, MAST, Taproot, see Rusty’s talk here.

Why ‘privacy coins’ won’t do

While there are a specific class of cryptocurrencies known as ‘privacy coins’ such as Monero and Zcash – I believe these will not benefit as much as Bitcoin benefits overall.

For example, see this paper talking about the ability to run analytics to ‘pierce the veil of your privacy’. From the Zcash blog response:

This research demonstrates different ways to pierce the veil of your privacy if you, or the people that you transact with, move money from a transparent address to a shielded address and then move some of that money back to a different transparent address.

Remember, there are always opportunity costs to holding the privacy coins, when really, there is a tendency for the market to coalesce around holding the most marketable asset (which in my view will be Bitcoin). i.e. the more Zcash or Monero you hold, the less Bitcoin you can hold. For more explanation on ‘the most marketable’ money, see my video here, “Why Bitcoin is not a fluke”.

There are other security problems and issues with some of the privacy coins, for which I’ll refer to JW Weatherman’s podcast episode here on Monero.



Don’t be under any illusions that the war on cash can be stopped politically. The pace of technological advancement is rapidly digitising our transactions. Politicians and bureaucrats will not be able to resist spying on people or controlling them with their newfound abilities of mass surveillance and confiscation. In my view it will be fruitless to try and stop this politically.

So bring it on. Let’s have more banning of cash, more capital controls, more absurd bail-ins, negative interest rates. All of these things will push people towards a more sound money, Bitcoin.

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