Crypto Exchanges Face New Regulation In Australia
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The Australian government has recently declared its plan to regulate the digital asset sector by requiring crypto exchanges to obtain a financial services license from the local regulator. The move aims to protect consumers and encourage innovation within the crypto industry. However, some exchanges have voiced their concerns about the proposal. New Consultation Paper Released The Australian Treasury published a consultation paper titled “Regulating digital asset platforms” on October 16. The paper outlines the proposed regulatory framework for crypto exchanges and service providers, aiming to address consumer harms and systemic risks associated with the digital asset sector while supporting its growth and development. The paper proposes regulating crypto exchanges by applying the existing financial services regime rather than formulating separate rules for cryptocurrencies. In this framework, crypto exchanges would be required to seek a financial services license from the Australian Securities and Investment Commission (ASIC) and adhere to the same obligations as other financial service providers. Read Also: Breaking: California Gov Gavin Newsom Signs Crypto Regulation Bill The paper clarifies that regulations would primarily target crypto exchanges and service providers rather than individual cryptocurrencies or tokens. It recognizes the existence of diverse crypto assets, including payment tokens, utility tokens, security tokens, and stablecoins. The paper acknowledges that some of these assets may not currently fall under the definition of financial products as per the Corporations Act. To address this concern, the paper suggests conducting a token mapping exercise by the end of 2023. This exercise would classify different types of crypto assets and determine whether they should be regulated as financial products. Mixed Reactions From Crypto Exchanges The consultation paper on crypto exchanges operating in Australia has garnered a mix of reactions. Some view the proposal as a positive stride toward providing clarity and certainty within the crypto sector, while…
Filed under: News - @ October 16, 2023 4:12 am