• The Australian government is taking steps to ensure the regulation of crypto assets protects consumers.
• These steps include reforming the licensing and custody of crypto assets and subjecting crypto asset service providers to a set of obligations and operational standards.
• A consultation paper has been released to explore which elements of the crypto ecosystem are sufficiently regulated, as well as to identify and control emerging risks.
Australian Government Regulating Crypto Assets
The Australian government is taking steps to ensure the regulation of crypto assets protects consumers by reforming the licensing and custody of crypto assets, subjecting crypto asset service providers to a set of obligations and operational standards, and releasing a consultation paper which explores which elements of the crypto ecosystem are sufficiently regulated.
Reforming Licensing & Custody
The Anthony Norman Albanese-led government will prioritize protection for consumers by reforming the licensing and custody framework for cryptocurrencies that currently fall outside the financial services regulatory framework. They plan on commencing a public consultation process in mid-2023 in order to allow for sufficient consultation prior to introducing legislation.
Identifying & Controlling Risks
The Australian government has taken immediate steps in order to protect consumers from risks associated with cryptocurrencies, but more needs to be done. This includes identifying emerging risks within the system, as well as controlling them so that customers’ digital funds are safeguarded.
By working closely with stakeholders, Prime Minister Albanese’s government aims to get policy settings right so that they can protect consumers while also supporting innovation within this emerging sector.
Consultation Paper Released
A consultation paper has been released exploring which elements require additional attention in order for regulation of crypto assets to protect consumer interests. This will enable both the government and stakeholders alike focus on regulatory gaps, identify emerging risks, and enact policies accordingly so that customers can benefit from new digital products and services safely.