- According to Australia’s Minister of Financial Services, consultations will soon begin on regulating crypto assets.
- There’s no need for regulations for digital assets that qualify as financial products, per the executive.
- In the minister’s view, the recent collapse of FTX has necessitated clearer crypto regulations.
- The Australian government won’t pass cryptocurrency legislation until the completion of the consultation.
The minister of financial services in Australia, Stephen Jones, maintained In a recent interview with local media that consultations would soon commence to determine which crypto assets to regulate in the country.
The minister affirms the commitment of the government to foster its token mapping initiative geared towards defining digital assets. According to Jones, digital assets that qualify as financial products would not necessarily need new regulations.
“I don’t want to pre-judge the outcomes of the consultation process we are about to embark on. But I start from the position that if it looks like a duck, walks like a duck, and sounds like a duck, then it should be treated like one,” Jones stated. Meanwhile, Jones emphasized how the recent collapse of FTX has necessitated clearer and more robust crypto industry regulations. Recall that the exchange suffered an unprecedented fall in early November, worsening the market situation for the sphere.
According to the minister, after the crash, the government realized the urgency to focus on crypto assets that act like financial products but are unregulated.
Crypto Service Providers to Be Regulated by Australia
Beyond defining crypto assets, Australia also wants to design a framework to cater to licensing and regulating crypto service providers in 2023. According to a press release last December, the country will release a consultation paper early this year, marking its significant step towards regulating cryptocurrency.
The authorities want to determine regulations capable of protecting investors from the inherent risks in the industry. According to the regulator, this step would position the country’s economy toward embracing emerging opportunities and responding to future challenges.
Under Prime Minister Anthony Albanese, Australia is not planning to initiate any cryptocurrency legislation until the consultation’s completion.
According to its finance ministry, the country must have legal provisions for “buy now, pay later” operations.
On the Flipside
- The Australian Securities and Investments Commission (ASIC) and the Commonwealth Bank want the government to classify all crypto assets as financial products. But Jones believes a decision can only be reached after due consultations have been conducted with significant actors in the industry.
Why You Should Care
Although cryptocurrency trading is legal in Australia, the government does not regulate it. Market volatility and lack of regulation are two challenges when investing in cryptocurrency in Australia. However, the recent comments made by the financial executive shed some light on the government’s position on digital assets.
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