The Australian government has unveiled plans to regulate crypto assets, aiming to safeguard consumer interests by revising licensing and custody rules. To determine areas in need of further regulation, the government has issued a consultation paper.
With the goal of “ensuring the regulation of crypto assets protects consumers” and positioning the economy for new digital products and services, the Australian government plans to revise licensing and custody regulations for currently unregulated cryptocurrencies, according to an official statement released on Feb. 3.
The government, led by Anthony Norman Albanese, aims to enforce obligations and operational standards for crypto asset service providers, specifically targeting the protection of consumers’ digital assets.
Regarding the design of a custody and licensing framework, the Australian government intends to initiate a public consultation process in mid-2023, allowing for ample discussion before introducing legislation.
While the government acknowledges initial steps to protect consumers, it recognizes the need for further work. The released statement mentions, “A consultation paper released today explores in detail which elements of the crypto ecosystem are sufficiently regulated and which require additional attention. This will enable the Government and stakeholders to focus on regulatory gaps and ensure that emerging risks are identified and controlled.”
Despite immediate measures for consumer protection, there is an ongoing effort to understand future risks and potential in the crypto space, starting with the Treasury’s token mapping initiative.
An article published in August highlighted Australia’s initiative to become the first nation to “token map” the cryptocurrency digital assets sector.
The statement also emphasizes the Australian government’s willingness to collaborate with stakeholders in a systematic manner to establish appropriate policies for consumer protection and innovation in the expanding crypto sector.
In addition to the proposed regulations for crypto custody and licensing, the government has already taken steps to enhance consumer protection, including expanding the crypto team at the Australian Securities & Investments Commission (ASIC) and combatting scams. Measures have also been implemented to detect potential money laundering or terrorism financing.
