Australia is tightening oversight of cryptocurrency platforms through a recent draft legislation that would fold them into the country’s existing financial services regime, according to Assistant Treasurer Daniel Mulino.
On Thursday, Molino said the proposal is central to the government’s digital asset strategy unveiled in March. The bill, now open for consultation, would insert two new categories into the Corporations Act: digital asset platforms and tokenised custody platforms.
Any provider in those groups would need an Australian Financial Services License, bringing most exchanges under ASIC rather than AUSTRAC, where about 400 firms are currently listed.
The final legislation will introduce a new framework for digital asset businesses in Australia. It will do so by extending existing financial services laws but in a targeted way.
Daniel Mulino, Australia’s Assistant Treasurer. Related: SEC’s Project Crypto: Atkins Eyes Year-End ‘Innovation Exemption’ to Ease Digital Asset Rules
The proposed framework would extend obligations to activities specific to digital assets, including staking services, issuance of wrapped tokens, and operation of token infrastructure. Exchanges would also be required to meet custody and settlement standards aimed at safeguarding client holdings.
Mulino said the collapse of several digital asset companies exposed the risks of platforms pooling customer funds without proper protections, which is why the reforms will filter out “weak operators” while giving compliant firms a more thorough path to operate under clear rules.
“The intent is to provide certainty for business and confidence for consumers,” he said.
Daniel Mulino, Australia’s Assistant Treasurer. The proposal comes as APAC becomes one of the fastest-growing regions crypto-wise, registering a massive 300% increase in on-chain value received from July 2022 to the end of June of this year.
Australia’s superannuation system is also becoming an attractive system for crypto companies. Recently, Crypto News Australia reported that Coinbase and OXK are targeting SMSFs to launch dedicated products in order to drive more growth in the industry.
Related: Judge Denies Justin Sun’s Bid to Block Bloomberg Report on Crypto Holdings
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