Australian Finance Minister Jim Chalmers has unveiled a comprehensive regulatory framework for cryptocurrencies before the upcoming election process.
This new framework aims to protect users while also supporting innovation within the sector. The government intends for cryptocurrency platforms to take on responsibilities similar to those of banks, preparing a bill for public consultation.
Cryptocurrency Platforms Face Bank-like Responsibilities
The regulatory plan mandates cryptocurrency platforms to fulfill general financial obligations. These platforms will carry responsibilities akin to traditional financial institutions and will be tasked with ensuring the secure protection of investor funds. The proposal includes maintaining user assets in separate accounts and implementing special custody systems. Innovative regulations are also planned for organizations providing payment services in the cryptocurrency space. These organizations may benefit from certain exceptions if their activities are limited to stable digital assets. The goal is to treat such assets similarly to traditional payment methods.
Industry Insights and International Standards
The Australian government plans to consider feedback from the industry and the public when preparing the bill. The primary objective is to assess the potential of cryptocurrency technology and align the sector with international standards. This approach aims to enhance domestic confidence and attract global investor interest. The Digital Economy Council of Australia (DECA) stated that the regulations would positively impact the sector. According to DECA, strengthening the existing regulatory framework will promote sustainable growth in the cryptocurrency market while providing clarity on risk management and transparency. An important aspect of the new regulations involves stricter reporting requirements for digital asset issuance and proof of reserves. This initiative will enhance user trust and reduce market manipulation risks. With an expanded regulatory scope, the integration of cryptocurrency technology into financial markets and the broader economy will accelerate.