Australia aims to tighten regulations around crypto service providers, with draft law that will expand financial sector laws to crypto exchanges.
Assistant Treasurer Daniel Mulino said at a crypto conference on Thursday that the law was “the foundation of our Digital Asset Roadmap,” that the Albanese government Released in March.
“This is an initial version of the law, and we are looking for stakeholder feedback on effectiveness and clarity before continuing,” he said.
Currently, crypto exchanges simply facilitate trading assets such as Bitcoin (Btc) only need to register with the Australian transaction reports and analysis center (Austrac), which has 400 Crypto exchange Registered with its books, many of them are inactive.
DRAFT LAW to produce two new financial products
Mulino said the draft law will create two new financial products under the Corporations Act, a “digital asset platform” and a “tokenized custody platform.”
“This means the digital asset platform and tokenized custody platform service provider will need to hold a Australian financial service license,” he said.
The license will register all exchanges with the Australian Securities and Investments Commission. Currently, only exchanges that sell “financial products,” such as derivatives, should register with the corporate regulator.
Mulino added that the law is “targeted policies for major activities,” such as wrapped tokens, public token infrastructure, and staking.
Crypto platforms will also be subject to “a suite of obligations designed to accommodate the unique properties of digital possessions,” says Mulino, along with the standards for handling cryptos and repairing transactions.
Related: ASIC licensing policies for Stablecoin distributors in Australia
“The failures of digital asset businesses have highlights the consumer risks, especially where operators pull and hold client assets without the same care,” he added.
“It’s about sharing good actors and closing bad. It’s about providing assurance to the businesses and confidence of consumers.”
Strong penalties, but the “low risk” platforms are free of charge
Act violations are set to bring penalties up to 16.5 million dollars of Australia ($ 10.8 million), three times the benefit obtained or 10% of the annual transfer – whichever is greater – according to a release of the Treasury Press.
Platforms called as “smaller, low risk,” holding up less than 5,000 Australian dollars ($ 3,300) per customer and facilitating less than 10 million dollars of Australia ($ 6.6 million) a year, will be exempt from the rules.
The Treasury said the exemption is consistent with the approach to financial products such as non -payment facilities, the addition of law does not look to impose new policies to those who provide crypto or crypto creators or users for non -financial purposes.
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