Australia Introduces New Regulatory Framework for Digital Assets

Highlights:

• Australia introduces new digital asset regulations to ensure consumer protection and market fairness.
• Crypto businesses must follow Australian financial service laws, including obtaining AFSL and asset protection.
• The government plans to explore tokenization, CBDCs, and real-world assets to modernize the financial system.

The Australian government has introduced a new framework for regulating digital assets. The move aims to clarify industry guidelines while addressing risks to consumer protection and market fairness. On March 21, the Australian Treasury released a paper titled “Statement on Developing an Innovative Australian Digital Asset Industry,” outlining the proposed regulatory approach.

Australia outlines crypto regulation plan, promises action on debanking

Australia’s government, under its ruling center-left Labor Party, has proposed a new crypto framework regulating exchanges under existing financial services laws and has promised to tackle debanking.

It…

— NORQUE-NOQ (@NorqueNoq) March 21, 2025

Australia’s New Crypto Regulations

The Treasury Department said new laws will apply to crypto exchanges, custody services, and some brokerage firms that trade or store crypto. The new rules require crypto businesses to follow the same laws as other financial services in Australia. This includes protecting customer assets, obtaining an Australian Financial Services Licence (AFSL), and meeting minimum capital requirements.

The proposal mandates stablecoin issuers, digital asset trading platforms, and their service providers to comply with laws. However, small-scale and startup platforms that don’t meet certain size thresholds will be exempt. This also includes firms that develop blockchain-related software or create digital assets that are not classified as financial products.

These regulations align with global standards like the Singapore Payment Services Act and the European Union’s MiCA regulation.

Treasury Department stated:

“We want to seize these opportunities and encourage innovation at the same time as making sure Australians can use and invest in digital assets safely and securely with appropriate regulation.”

The government has decided to treat payment stablecoins as a type of “stored-value facility.” However, not all stablecoins or wrapped tokens will be affected by these rules; some will be exempt. The government also clarified that buying, selling, or trading these stablecoins on platforms won’t be considered a formal “dealing activity.” This means platforms, where stablecoins are traded, won’t be treated as market operators just because of this activity.

Government Strategy to Combat Debanking

The government acknowledged that debanking, where banks limit services to crypto firms, is becoming a bigger issue. The new licensing rules aim to improve risk management and transparency, which could help reduce debanking by banks.

The paper reads:

“The government has been working with stakeholders to ensure transparency and fairness, including engaging with Australia’s major banks to understand the extent of debanking.”

The Treasury’s Statement also highlighted plans to include tokenization, real-world assets (RWAs), and central bank digital currencies (CBDCs) as part of its efforts to modernize the financial system.

In September, the central bank and the Treasury released research on CBDCs. They noted that a wholesale CBDC could enhance Australian markets. According to the government, the Australian Treasury, the Australian Securities and Investments Commission (ASIC), and the RBA are planning to launch trials for the use of tokenized money. This includes CBDCs and stablecoins.

Speech by Brad Jones, Assistant Governor (Financial System), at the Intersekt Conference in Melbourne – 'Financial Innovation and the Future of CBDC in Australia’: https://t.co/zuYTeslJhZ pic.twitter.com/3ndAbgjepq

— Reserve Bank of Australia (@RBAInfo) September 17, 2024