Internal documents from the Australian Treasury Department reveal that the formulation of cryptocurrency legislation in the country might take at least a year, potentially extending beyond 2024. The government’s approach suggests a careful examination of the crypto industry, with consultation papers slated for release in Q2 2023 and stakeholder roundtables on crypto licensing and custody planned for Q3.
Obtained through freedom of information laws by the Australian Financial Review, the documents indicate that final submissions to the cabinet may not occur until late in the year, delaying potential decisions on cryptocurrency legislation until after 2024.
Consultation open! Today we released the token mapping consultation paper. This consultation is part of a multi step reform agenda to develop an appropriate regulatory setting for the #crypto sector. Read paper & submit views @ https://t.co/4W2msjhP9B @ASIC_Connect @AUSTRAC pic.twitter.com/OGHuZEGvDp
— Australian Treasury (@Treasury_AU) February 2, 2023
Acknowledging possible frustration among crypto businesses and consumer groups due to the extended timeline, the Treasury Department expects some stakeholders to be disappointed with the perceived delay in implementing a licensing regime, citing consumer groups seeking immediate protections and businesses seeking regulatory legitimacy.
Despite this, the Treasury Department believes that the demand for cryptocurrencies has weakened after the collapse of FTX, giving them additional time to develop regulatory frameworks. The documents mention the establishment of a specialized “crypto policy unit” within the Treasury department.
In November, the crypto policy unit discussed potential prerequisites for crypto licenses, including “fit and proper person” tests, meeting capital requirements, reporting fraudulent activities, and enhancing consumer safeguards. A survey by Australian crypto exchange Swyftx in September indicated that about one million Australians planned to buy cryptocurrency for the first time in the following year.
