Australia is taking critical steps to establish a clear regulatory framework for the crypto sector, according to a statement from the Treasury on the development of the innovative Australian digital asset industry.
The Treasury said the move aims to enhance consumer protection, reduce risk and provide much needed clarity to the industry.
Regulatory Framework
Under the proposed framework, certain crypto companies will be raised under existing financial services laws.
This includes exchanges, custodians, and stubcoin issuers. All of these require you to obtain an Australian Financial Services License (AFSL) to operate legally. These businesses are subject to new rules designed to reflect the specific nature of digital assets.
The Treasury argued that these measures are essential to reduce risks of custody, liquidity, counterparty relationships, fraud and cybersecurity. Meanwhile, companies that handle tokenized stored value products (such as stablecoins used for payments) must meet strict requirements.
These include customer assets protection measures, reimbursement processes, and liquidity support, reflecting standards applied to traditional non-cash payment systems.
The rules aim to bring more structure to the industry, but not all crypto-related entities fall into the new regime. Developers who create non-financial blockchain applications and those who build or maintain decentralized protocols remain out of scope.
Additionally, small startups that do not meet the proposed threshold may be exempted, but may need to follow limited compliance rules.
The Treasury has confirmed that a draft version of the law will be released later this year for public consultations. Opinions from the Australian Securities and Investment Commission (ASIC) will help shape the final framework.
Wide range of reforms
Beyond licenses, the government is exploring broader crypto-related reforms. These include the new Crypto Asset Reporting Framework (CARF) and measures to address the decanking challenges that affect many crypto businesses.
According to authorities:
“Breakdowns can have a devastating impact on businesses and individuals who have left banks, and can curb competition and innovation in the financial services sector, and negatively impact Australia’s competition.
economy. “
Additionally, regulators are also investigating the possibility of launching tokenization laws and central bank digital currency (CBDC).
Meanwhile, the Enhanced Regulatory Sandbox (ERS) will receive reviews in 2025. This sandbox helps businesses test financial services and credit innovation without the need for a license and promote safe experiments within Australia's fintech space.
