It would record the Bluetooth connections a phone makes with others, with the user giving the data to state health authorities if they caught the virus.
But app developer Quentin Zervaas says the government should hold off for a couple more weeks while the tech giants finish work to ensure iPhones and Android devices can do this kind of tracking.
Otherwise, it risks losing public confidence if things go wrong.
"I think people will be receptive to trying to help but if it doesn't work right and then the government says, 'Oh, hang on, we're going to do this in a few weeks, it'll be a bit better' - I don't think people will be as receptive to it," Mr Zervaas said.
He doesn't believe the government app will work on iPhones the way ministers and health officials have said, given the limitations Apple places on Bluetooth usage.
Similar issues have led to usage rates in Singapore sitting below 20 per cent.
The federal government says Australia needs to aim for 40 per cent of the population using the app in order to start easing travel restrictions and business closures sooner.
However, state ministers have been less gung ho, with NSW and Victoria saying decisions around easing restrictions will be based on medical advice.
If the Bluetooth issues weren't a problem, Mr Zervaas says Apple and Google wouldn't have come together for an unprecedented partnership to work on a new framework to allow tracing apps.
"They know their system isn't designed and their devices aren't designed to be basically every device pinging every other device on an ongoing basis," he said.
The tech companies plan to release the first stage of the new tool in May, to allow official public health tracing apps to work.
"It's so critical for the government to wait for it," Mr Zervaas said.
"I don't know why they think they can implement a better solution than the platform manufacturers, especially when the track record of the government isn't great and the track record on the other side, of Apple and Google, is a lot better on these technical things."
Many people also have privacy concerns about the app.
The government has commissioned an independent privacy assessment in a bid to soothe these.
"We are going to have protections for the privacy and security information like nothing that there has ever been," Attorney-General Christian Porter said.
Mr Zervaas says the government should commit to releasing the app's source code for full transparency.
People in Australia must stay at least 1.5 metres away from others and gatherings are limited to two people unless you are with your family or household.
If you believe you may have contracted the virus, call your doctor (don’t visit) or contact the national Coronavirus Health Information Hotline on 1800 020 080. If you are struggling to breathe or experiencing a medical emergency, call 000.
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