Senator Andrew Bragg has introduced a bill proposing regulatory standards for the cryptocurrency industry in Australia.
A new bill has been introduced to the Australian parliament proposing regulations for the provision of cryptocurrency services in the country.
Senator Andrew Bragg submitted a private senators’ bill titled Digital Assets Bill 2023 to ‘protect consumers and promote investors’, which includes regulatory recommendations for stablecoins, licensing of exchanges and custody requirements.
Proposed regulatory changes are typically introduced by Australian ministers. However, as the Parliamentary Education Office stipulates, members of parliament can introduce private members’ or private senators’ bills, which can take months or years to pass through parliament.
Bragg provided further information for the submission of the private bill, hitting out at the current Labor government for not following through on 12 recommendations relating to cryptocurrency regulation introduced by the Senate Select Committee on Australia as a Technology and Financial Centre in October 2021.
The senator also added that Australian consumers had been left exposed to industry-wide events like the collapse of FTX by the inaction of the Australian government to provide regulatory clarity to the sector.
“Australia can be a digital asset hub whilst protecting digital asset consumers. But we must act now.”
The act looks to provide a regulatory framework for cryptocurrency exchanges, custody services and stablecoin issuers which both protects consumers and promotes investment.
It also looks to provide guidelines for the reporting of information by authorized deposit-taking institutions (ADIs) for the issuance and control of central bank digital currency (CBDC).
If passed, the bill would require a person or business to hold a license granted by the Australian Securities and Investments Commission (ASIC) or a foreign license to operate a cryptocurrency exchange. This would also apply to cryptocurrency custody services and stablecoin issuers in Australia.
The bill also sets out a variety of obligations and requirements for exchanges, custody services and stablecoin issuers. This ranges from capital or minimum reserve requirements, segregation of customer funds, reporting on customer holdings as well as auditing, assurance and disclosure arrangements.
Public consultation is currently ongoing in Australia over the classification of cryptocurrencies and various digital asset tokens, services and platforms. The ‘token mapping’ consultation paper was released in February, outlining basic definitions for the cryptocurrency sector.