Australia aims to strengthen regulations concerning cryptographic service providers, with a bill that would extend laws on the financial sector to crypto exchanges.
Deputy Treasurer Daniel Mulino told a crypto conference at local time on Thursday that the legislation is “the cornerstone of our digital asset roadmap”, which the Albanian government published in March.
“This is a preliminary version of the legislation, and we are looking for stakeholders’ comments on its effectiveness and clarity before continuing,” he said.
Currently, crypto exchanges that simply facilitate negotiation assets like Bitcoin (BTC) only need to register with the Australian Transaction Reports and Analysis Center (Austrac), which reported 400 exchanges of crypto recorded on his books, many of which are inactive.
Bill to manufacture two new financial products
Mulino said that the draft legislation would create two new financial products under the law on companies, a “digital asset platform” and a “Tokenized police custody platform”.
“This means that the digital asset platform and token-care platform service providers will have to hold a license in Australian financial services,” he said.
The license would record all exchanges with the Australian Securities and Investments Commission. Currently, only exchanges that sell “financial products”, such as derivatives, must register with the corporate regulator.
Mulino added that the legislation had “targeted rules for key activities”, such as wrapped tokens, public tokens infrastructure and jalitude.
Cryptographic platforms will also be subject to “a series of obligations designed to adapt to the unique characteristics of digital assets,” said Mulino, including crypto and settlement transactions.
“The failures of digital asset companies have highlighted the risks of consumers, especially when operators draw and hold customer assets without coherent guarantee,” he added.
“It is a question of legitimizing the good actors and of closing the evil. It is a question of giving the certainty of companies and the confidence of consumers. ”
Heavy breakdowns, but “low-risk” platforms exempt
The law violations should bear up to $ 16.5 million Australian dollars ($ 10.8 million), three times the advantages obtained or 10% of annual turnover – according to the largest – according to a press release from the Treasury.
Platforms nicknamed “smaller and at low risk”, which hold less than 5,000 Australian dollars ($ 3,300) per customer and facilitate less than $ 10 million Australian dollars ($ 6.6 million) per year, will be exempt from the rules.
The Treasury said that the exemption is in accordance with the approach of financial products such as non -monetary payment facilities, the addition of legislation does not seek to impose new rules on crypto issuers or those who create or use crypto for non -financial purposes.
Cryptographic industry supports the bill
The main exchanges of crypto operating in Australia supported the government’s bill, welcoming its decision to carry out the crypto within the framework of the Australian license regime of financial services.
Swyftx CEO Jason Titman told Cintelegraph that he had praised the announcement and “expected a requirement for exchanges to have a license for financial services”.
“I don’t think our industry should be afraid of high standards,” he added. “It seems that the government balances consumer protections and innovation in a sensible and thoughtful way.”
OKX Australia CEO Kate Cooper told Cintelegraph that the “real measure” of the draft laws will be their application, ensuring that “responsible and authorized operators are not underguised by unregulated players and that Australian consumers are protected”.
In relation: ASIC softens the license rules for stablecoin distributors in Australia
Crypto.com Australia Crypto.com director Vakul Talwar said the bill was “late for a long time” and supported the decision to regulate the crypto under the laws on financial services because it “protects consumers without imposing excessive administrative formalities”.
Talwar added that the draft laws show “a clear understanding of the needs of the sector” and that an ASIC proposal so that companies have an operating license from the market “would have smothered innovation and motivated businesses in Offshore and far from the Australian market”.
Kraken Australia’s managing director Jonathon Miller said that the draft legislation offered “investors and institutions greater certainty”, but added that it was “vital that the regulations avoid a unique approach that could suffocate competition or disadvantage smaller innovators”.
Mulino said that the government would now conduct a large consultation on the rules of rules, which will be used to develop them in their final form.
The Treasury opened the feedback bill until October 24.
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