Australia’s emerging cryptocurrency sector would be among the world’s leaders if an proposed regulatory system for the industry is approved, according to the former head of the corporate watchdog.
Following a bipartisan Senate report recommending regulation to ensure Australia’s global competitiveness, the coalition on Monday pledged to regulate and authorize crypto-currency exchanges, while crypto-deposits also need to be accredited – if it wins the election in May.
Still to work through is how all regulations work alongside existing financial services and corporate laws, with the coalition wanting to take a “minimalist” approach and avoid a double-up.
The claims would be largely polished by the Australian Securities and Investments Commission, along with the Australian Competition and Consumer Commission.
It is a sign, along with similar movements in the US and Europe, of the widespread acceptance of the use and place of cryptocurrency in the broader economy. According to the Treasury, 800,000 Australians have traded cryptocurrencies in the last three years, although concerns have been raised about how well it is understood by investors.
Digital Economy Minister Jane Hume on Monday compared the scheme with the well-known tick of the Heart Foundation’s approval for nutrition standards, saying the regulations would give Australians confidence in the sector.
Senator Hume, who described the publication of the advisory paper in a speech at Australian Blockchain Week, said that with “proper regulation” the Australian sector could be “as much as $ 68.4 billion” by 2030 and have 200,000 jobs .
The promise comes after the high-profile cryptocurrency exchange collapsed, though Senator Hume repeatedly stressed that the government could not, and could not, protect investors from itself.
“Crypto-values will go up and down, as surely as eggs, and this does not protect from market volatility, but if they use a licensed Australian exchange, it will deliver promise,” she said.
Former ASIC President Greg Medcraft said Australia was pursuing the lead of Europe and the US – where President Joe Biden earlier this month issued an executive order to develop a full-fledged government response to cryptocurrency use.
“It’s about being competitive as a country (and) ensuring that investors have confidence and confidence, so that markets are transparent,” said Mr Medcraft, who has spent several years in Europe at the OECD as head of its finance and Company management spent. back in Australia as non-executive director of financial group AFG.
“It’s a good move but now it needs to be implemented … if everything that is announced is implemented, it will certainly create an enabling regulatory framework similar to where Europe is and where Biden is going.”
The government proposal has been warmly welcomed by the industry. Immediately after Senator Hume’s speech at the conference, Lisa King, chief executive of ASX-listed Bitcoin trader DigitalX, replied: “Eureka! We have legislation.”
Binance Australia chief executive Leigh Travers said even if not all the details were 100 per cent clear, the “momentum is in the right direction”.
Australia had ground to do, he said, and the government’s plan would help.
“We have already lost innovation, with global markets leaving Australia,” Mr Travers said. “Therein lies the opportunity.
“If we move quickly to meet this value during this construction phase, not at the end of a business life cycle … it will allow Australia to win technology innovation and have great jobs for those who want to work in the sector.”
BTC Markets chief executive Caroline Bowler said the announcement pushed Australia into a world-leading regulatory environment and leveled the playing field.
“It also establishes parity with traditional finance in terms of regulatory and technology requirements,” she said.
“Furthermore, it is an opportunity to demonstrate the technical advantages of blockchain technology as a trading solution versus traditional banking.”
Senator Hume said the regulatory platform should be agnostic – a title deed, for example, was treated the same in print and digital format, so it should also be treated as a title deed when converted to an NFT.
Australian Blockchain Week continues in Sydney on Tuesday and will move to Perth on Thursday, where the focus will be on regulation. The government has opened the consultation on its proposal until 27 May.
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