Australian Regulator’s Journey Towards Outcome-Based Crypto Regulations

The Australian Securities and Investments Commission (ASIC) will prioritize achieving specific regulatory objectives as it nears the completion of developing and implementing a series of regulatory reforms for the crypto sector.

During “The Brief—Open Forum” on Mar 20, part of Blockchain APAC’s Policy Week, ASIC Commissioner Alan Kirkland outlined the organization’s strategy to foster responsible financial innovation and support its growth.

Source: ASIC Media 

Kirkland emphasized the necessity of addressing the “regulatory trilemma” concerning financial innovations, which involves balancing consumer protection, market integrity, and the promotion of financial innovation.

The ASIC aims to enhance trust in crypto and decentralized financial systems by enhancing supervision and balancing the trilemma factors. However, the commissioner stated that since 2016, the ASIC had offered informal regulatory guidance to more than 900 entities.

When talking about the changes coming up, Kirkland explained:

“What we want is straightforward rules that keep the market fair and protect people who buy and invest – plus ways to make sure everyone follows these rules, and we can make sure they do.”

ASIC’s Crypto Regulation Plans

Moreover, the ASIC has many ideas for turning financial and regular things into tokens. Kirkland said, “Some token ideas will follow the rules we have now, while others will need the new digital asset platform the Government’s talking about.”

Kirkland thinks ASIC can make digital money safer and spread it to more people by being smart about rules and developing new ideas.

In Oct 2023, the Treasury Department wrote a paper asking for opinions. They suggested that crypto exchanges should have to get a license from the local financial regulator.

Proposal for Regulating Digital Asset Platforms: From the Australian Treasury

The new rules say any crypto exchange with over 5 million Australian dollars ($3.2 million) or over AU$1,500 ($946) for each person has to get a license from the ASIC.

However, the plan received different reactions from crypto exchanges in Australia. The Treasury said it wants to hear what people think about the ideas and rules in the paper.

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The author’s views are for reference only and shall not constitute any investment advice. Please ensure you fully understand and assess the products and associated risks before purchasing.

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