Australia’s Crypto Industry Faces Regulatory Transformation in 2024

Australia is moving swiftly in the direction of a thorough regulatory framework for the cryptocurrency sector. The country’s Treasury said on Monday that it is drafting legislation with a 2024 deadline that would include licensing and custody guidelines for companies that offer digital assets. A key step toward formalizing cryptocurrency rules in the nation will be made when this legislation is passed, giving Australian exchanges a 12-month transition period to comply with the new legal framework.

Australian digital asset platforms could not be granted licenses under the new system until 2025, according to the suggested timeframe, but these moves show Australia’s dedication to creating a well-organized crypto regulatory framework.

Australia’s blueprint for regulating cryptocurrencies has been anxiously awaited. Following its original introduction in February of the same year, the plan was initially anticipated to be released around mid-2023. In contrast to an earlier consultation on token mapping, the delayed publication in October took the form of a consultation document. Token mapping is the process of determining the primary operations and features of cryptocurrency goods and coordinating them with current legal frameworks.

Consumer Protection Focus and Broad Regulatory Net

The Australian Assistant Treasurer and Minister for Financial Services, Stephen Jones, spoke at The Australian Financial Review Crypto Summit (AFRCM) at the same time as this significant regulatory advancement. AFR broke the news of the proposal’s specifics first.

Blockchain Australia Chair Michael Bacina offered his thoughts on the idea, saying, “Australia has been waiting for certainty over digital asset regulation so that it can seek to catch up with the rest of the world.” He underlined that the proposal’s strategy is focused on protecting consumers and attempts to cast a wide regulatory net to include a variety of business types that presently operate without regulatory scrutiny. This may also include NFT licensing holding customer assets.

The proposal unveiled on Monday stipulates that in order to operate legally, all cryptocurrency exchanges must obtain an Australian Financial Services license from the Australian Securities and Investments Commission if they hold more than AUD 1,500 ($946) in assets for any one client or more than AUD 5 million ($3.15 million) in total assets. The plan asks for written responses from industry stakeholders and includes 32 major topics. The deadline for submissions is December 1, 2023.

A local crypto exchange’s general counsel, Adam Percy, endorsed the government’s engagement process and emphasized the value of “a level playing field for national and overseas crypto platforms.” He praised the administration’s careful strategy, which tries to strike a balance between strong consumer safeguards and encouraging innovation in the cryptocurrency industry.

This legislative change is an important step forward for Australia’s efforts to create a well-structured and regulated crypto economy. It offers direction and clarity for both companies and investors in the digital asset market.