Australian cryptocurrency exchanges are mostly welcoming a plan to subject them to the same rules as traditional financial institutions, but want the federal government to move quickly.
After a nine-month consultation period on cryptocurrency regulations, Treasurer Jim Chalmers on Monday unveiled a consultation paper that proposes Australia regulate exchanges.
It’s an approach mostly favoured by the domestic industry, which is cooler on any attempt to try to enact rules on the thousands of individual cryptocurrencies, such as the stablecoins that attempt to mirror the value of national currencies.
Digital currency exchanges that hold more than $5 million in assets or more than $1,500 from an individual would have to get an Australian financial services licence under the plan.
Independent Reserve chief executive Adrian Przelozny called on the Albanese government to quickly enact the “milestone” proposals to drive confidence in the industry.
“This isn’t just about regulation; it’s about restoring trust. We firmly believe these changes will drive investment, provide certainty to the sector and ultimately, increase consumer protection.”
BTC Markets chief executive Caroline Bowler said the Melbourne-based exchange’s sister company, BTCM Payments, had already held an Australian financial services licence since 2022.
“A positive progression for the crypto industry; a great next step for the Australian economy,” Ms Bowler said of the proposal.
“Digital assets are so clearly the future of financial services.”
Adam Percy, the general counsel of Swyftx, said the consultation was a thoughtful attempt and the Brisbane-based crypto exchange agreed on the need to protect users while leaving room for innovation.
“This is an important step because Australia will benefit from a secure and vibrant blockchain sector,” he said.
“Everyone wants to know where the next big triggers for economic productivity are going to come from, well here you have one.
“Blockchain technology and digital assets can unlock huge value to our national economy in areas like disintermediation and tokenisation.”
But Liberal Senator Andrew Bragg, who was his party’s point man on crypto regulation under the Morrisson government, said that Labor had effectively “locked Australia into the slow lane on crypto reform” with a consultation paper that was little more than a re-hash of one released back in March.
“The Proposal Paper released today is just that, a Proposal Paper,” Senator Bragg said in a statement.
“Crypto consumers will continue to be exposed to an unregulated market until these proposals become law.”
Steve Vallas, the managing director of Blockchain APAC, said in a LinkedIn post that the paper was a critical milestone for the industry but the details in the legislation that follows would determine how quickly Australia competes in attracting investment and talent.
“How quickly we move from here will be critical as you cannot be deemed a fast follower if you only follow those who don’t move quickly enough,” he wrote.
Comments on the paper are due by December 1.
(Australian Associated Press)