Australia Unveils New Crypto Regulations, Pledges Action on Debanking

The Australian government, under Prime Minister Anthony Albanese, has outlined a new regulatory framework for digital assets, with the aim of offering more certainty for participants in industry and at the same time tackling risks that are linked to consumer protection and market integrity.

The reforms require that large crypto platforms obtain an Australian financial service license and at the same time free smaller companies and companies that are not involved in financial services.

Treasury’s explanation about the development of an innovative Australian digital assets industry paperReleased on Thursday, details are planning to regulate digital asset vlatforms and payment staboins under existing financial services legislation.

The move follows at similar regulatory approaches to the European Union and Singapore, the Ministry of Finance wrote.

“By tuning for international best practices, Australia can stimulate the global competitiveness of our digital assets sector,” is the paper.

It is worth noting that both the EU and Singapore have taken important steps to regulate crypto, whereby the EU introduces Mica as a tailor -made regime, while Singapore has expanded its existing Payment Services Act with crypto service providers in the context of its license and compliance framework.

Before Mica, the EU applied existing financial regulations such as MiFID II for Security Stokens, the E-money directive for Stablecoins and AMLD5 for crypto exchanges, a phased approach comparable to Australia’s strategy.

Regulating scope and important inclusions

The proposed framework applies to crypto fairs, guardian fee services and specific broker platforms that facilitate the trade and storage of digital assets.

Companies that offer tokenized value facilities stored, including some Stablecoin emission, will also be subject to permits and compliance obligations.

However, companies that make or use digital assets for non-financial purposes, developing software or maintaining digital asset infrastructure will not fall under the new regulations.

The government is trying to tackle Debanking

The government also recognized Debanking – where financial institutions limit services to crypto companies – as a growing problem.

The new license regime is intended to improve risk management and transparency within the sector, which could reduce the cases of debit by major financial institutions.

“The government has collaborated with stakeholders to guarantee transparency and honesty, including involving the most important banks of Australia to understand the size of Debanking,” is the newspaper.

Jonathon Miller, director of Kraken of Australia, welcomed the initiative and emphasized the need for customized legislation to reduce uncertainty.

“It is great to see recognition of the urgent need for tailor -made crypto legislation to tackle the existing confusion and uncertainty with which Australian crypto investors and companies are confronted,” said Miller Decrypt. “By setting up a clear regulatory framework and alleviating problems, such as Debanking, the government can remove the barriers that impedes growth in the Australian economy.”

The government is planning to release a legislation for public consultation somewhere this year.

The Australian Securities and Investments Commission is also expected to refine its guidelines for digital assets with further updates for his Information sheet 225.