Australia Needs Regulations to Facilitate Crypto Business, Senate Committee Reports – Bitcoin News Regulatory – News Couple

Australia Needs Regulations to Facilitate Crypto Business, Senate Committee Reports – Bitcoin News Regulatory

A Senate committee in Australia has made a number of proposals to address the lack of proper regulations in the crypto space. Lawmakers believe the country needs new rules for its fintech and digital asset industries to be able to compete with jurisdictions that are already attracting some of their crypto firms.

Senate Committee Calls for Absorption of Crypto Rules in Australia

The rapid expansion of the cryptocurrency space has surprised many governments, but while other countries are already providing some regulatory clarity to market participants, Australia has yet to introduce more specific rules for related industries. According to the Select Committee on Australia as Technology and Financial Centre, which has published a new report on the matter, updated regulations should allow the country to drive innovation.

The panel made a set of recommendations to address issues in key areas affecting the competitiveness of Australia’s technology, finance and digital asset sectors. The problems identified by interested parties relate to the regulation of cryptocurrencies and similar assets, the “de-banking” of fintech and other innovative companies, and the current policy environment of digital banking institutions, or so-called “new banks.”

As a first proposal, Australian senators asked the government to create a licensing system for crypto exchanges covering aspects such as capital adequacy and auditing. The report’s authors note that current rules are limited and only require these trading platforms to register with the country’s financial intelligence agency, Ostrack, despite the fact that they often process billions of dollars in crypto assets. The lack of certainty is said to be a challenge for businesses, investors, and consumers. The committee notes that:

A prominent Australian-based cryptocurrency exchange (DCEs) recently obtained regulatory licenses in Singapore and the UK respectively, showing what Australia is missing by not developing a proper framework here.

Lawmakers are also calling for a regulatory regime for custody and deposit services for digital assets to address specific risks that differ from those associated with traditional financial assets. They believe that “given the scale of the current industry in Australia for custodianship of traditional assets, there is significant scope for Australia to benefit from becoming a leader in digital assets.” Different crypto assets need to be categorized, and I also recommend a “token mapping exercise.”

The senators also proposed the introduction of a special legal structure for the Decentralized Autonomous Organization. The rationale behind this move is to “ensure that emerging types of blockchain-based organizations can be clearly established in relation to how they operate in Australia.” They point out that this approach has already been used by other governments and allows such entities to operate as LLCs.

The Committee considers it necessary to conduct a review of Australia’s AML/CFT regulations in order to avoid undermining innovation and to ensure that these standards are ‘fit for purpose’. The senators added that applicable tax rules needed further clarification, noting that digital asset transactions only create a capital gains tax event “when they really result in a clearly identifiable capital gain or loss.” The report recommends a 10% tax cut for Australian crypto miners who use their renewable energy.

The paper released by the select committee also discusses the issue of central bank digital currencies (CBDCs), revealing that its members are aware of the opportunities and risks associated with state-issued coins. The senators suggest: “The Committee considers that the Treasury should conduct a policy review on the potential for a retail central bank digital currency in Australia, to ensure that these issues continue to be appropriately explored in the Australian context.”

Do you think Australia has the potential to become the next major crypto-friendly jurisdiction? Share your predictions in the comments section below.

Tags in this story

Australia, Australia, CBDC, CBDCs, Commission, Crypto, Crypto Assets, Cryptocurrencies, Cryptocurrency, Custodians, Digital Valuations, Digital Currency, Exchanges, Framework, Legislators, Proposals, Recommendations, System, Regulations, Regulation, Report, Requirements, Rules, Select Committee, Senate, Senate Committee, Senators, Standards

photo credits: Shutterstock, Pixabay, Wikicommons

disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services or companies. does not provide investment, tax, legal or accounting advice. Neither the Company nor the author shall be liable, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

Source link

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button