according to the materials from the site - By Crypto Breaking News
Australia is implementing plans to tighten cryptocurrency regulation, aiming to extend the same legal framework to digital asset service providers as that applied to traditional financial institutions. The proposed bill, which is currently in draft form, aims to enhance oversight and consumer protection, as well as ensure transparency for the cryptocurrency business operating in the country's emerging markets. This event reflects Australia's intention to strengthen its position as a key player in the regulation of cryptocurrency and blockchain activities.
Australia is ready to revise its cryptocurrency regulation system by adopting a new bill that could fundamentally change the management and trading of digital assets in the country. Assistant Treasurer Daniel Mulino explained at a recent crypto conference that this legislation is a foundational component of Australia's digital asset strategy first presented earlier this year.
Unlike the existing system, where only cryptocurrency exchanges trading Bitcoin and other assets are registered with AUSTRAC, the proposed bill will introduce broader licensing requirements. Mulino noted that the bill aims to officially classify digital asset platforms and custodial service providers, requiring them to hold an Australian Financial Services License (AFSL). This move is intended to make digital asset services more structured and regulated, bringing them closer to traditional financial institutions under the oversight of the Australian Securities and Investments Commission (ASIC).
Mulino emphasized that the legislation will include targeted rules for specific types of activities, such as wrapped tokens, public token infrastructure, and staking mechanisms. Additionally, crypto platforms will have to comply with standards developed with the unique characteristics of digital assets in mind, covering areas such as secure storage, transaction settlement, and transparency.
In response to questions about the risks of digital assets, Mulino stressed that recent failures have revealed vulnerabilities, especially in cases where operators hold client funds without adequate safeguards. The new rules aim to formalize best practices and eliminate bad actors in the market, providing clearer guidance and legal certainty for compliant operators, while enhancing consumer trust.
"It's about legalizing good market participants and filtering out the bad ones. It's about giving companies confidence and consumers trust."
Violating the new rules could result in fines of up to 16.5 million Australian dollars (10.8 million USD), the amount of which will depend on the profit gained or a percentage of annual turnover. However, low-risk platforms, meaning those with less than 5,000 Australian dollars (3,300 USD) per client and conducting transactions of less than 10 million Australian dollars (6.6 million USD) per year, will be exempt from these requirements.
The Treasury explained that these exceptions align with practices applied to other financial products, such as cashless payment systems, reflecting an intention to regulate activities without stifling small or emerging crypto companies. Importantly, the legislation is not aimed at over-regulating cryptocurrency issuers or those using digital assets for non-financial purposes, but rather supports a balanced approach to innovation and protection.
As Australia advances its regulatory agenda, the crypto industry and investors will closely monitor how these reforms impact the growth and security of the digital asset ecosystem in the region.
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