The Australian Treasury has unveiled an ambitious plan to regulate and integrate digital assets into the nation's financial system, taking cues from regulatory frameworks in Singapore and the European Union.
The comprehensive white paper outlines how Australia aims to embrace various digital assets, including tokens, real-world assets, and potential central bank digital currencies. The initiative involves coordination between major regulatory bodies like the Australian Treasury, Securities and Investment Commission, and Reserve Bank.
A centerpiece of the plan introduces Digital Asset Platforms (DAPs), a new licensing framework for cryptocurrency exchanges. Under these rules, operators must comply with financial service regulations, maintain adequate capital reserves, and provide transparent disclosures. The framework requires DAPs to use third-party custodians for storing customer assets, adding an extra security layer for investors.
The government's approach addresses the persistent issue of "de-banking," where traditional banks refuse services to crypto companies. Through the DAP licensing system, banks will receive guidance on managing risks when working with digital asset firms.
To support innovation, smaller exchanges and startups falling below certain thresholds will face lighter regulatory requirements. Similar exemptions apply to blockchain software developers and creators of non-financial digital assets.
The plan also introduces specific treatment for payment stablecoins under Government Payment Licensing Reforms, with certain stablecoins and wrapped tokens receiving exemptions from particular regulations.
Draft legislation is expected in 2025, with public consultation to follow. The timing coincides with Australia's federal election deadline of May 17, 2025, where both major political parties have expressed support for crypto regulation.
Industry reaction has been largely positive. Caroline Bowler, CEO of BTC Markets, praised the reforms as sensible while calling for clarity on specific requirements. Kraken Australia's Jonathon Miller highlighted the importance of establishing clear regulations to remove growth barriers in the Australian economy.
The initiative aims to reduce transaction costs, increase market efficiency, and broaden access to traditionally restricted assets, potentially transforming Australia's financial landscape.