As every region begins to take the topic of crypto regulation more seriously, Australia has also made plans to create a regulatory framework that will oversee the activities of digital assets service providers in 2023.
Part of the framework will address licensing, building custody, regulation, and checkmating what digital assets fall under financial services laws. It would also consider rules related to customer protection.
The government of Australia under the rulership of Prime Minister Anthony Albanese intends to release a consultation paper in the first quarter of next year.
According to Treasurer Jim Chalmers and Assistant Treasurer Stephen Jones, this consultation paper will help streamline which digital assets should be regulated by law. It is after this consultation that the regulation will be signed into law when a final decision is made.
The joint media release stated, “The next steps in the Government’s ongoing ‘token mapping’ work will include the release of a consultation paper in early 2023 to inform what digital assets should be regulated by financial services laws, and the development of appropriate custody and licensing settings to safeguard consumers.”
Australia Builds its Financial Service Infrastructure
Apart from adjusting crypto regulations, the Australian government is making significant adjustments and modernizing its financial service laws as regards payments.
The Albanese government is establishing a framework for Buy Now Pay Later (BNPL) as well as a ‘strategic plan’ that will involve industries, customers, regulators, and other business representatives.
Chalmers spoke of the need for so many adjustments in its financial service infrastructure, he said “The one constant in finance is change. It’s fast moving, dynamic and our regulatory frameworks haven’t kept up. Our reforms are about starting to fix that in pursuit of a financial system that is stronger and more secure.”
Noteworthy, the volume of bankruptcies filed this year including that of Celsius Network, Voyager Digital, and Three Arrows Capital (3AC) coupled with the latest implosion of FTX Derivatives Exchange has forced regulators in different regions to raise the regulation bar. The Financial Stability Board (FSB) has announced its intention to roll out guidelines for crypto regulation in 2023.
Also, the International Monetary Fund (IMF) is advocating for robust crypto regulation in Africa, especially in countries like Nigeria which has a sporadically growing crypto ecosystem.