Australian Senate committee makes 12 recommendations for crypto regulation

An Australian Senate select committee has submitted its final report on a year-long review of the country’s approach to crypto and blockchain regulation, seeking to guide, for the first time, a clear framework for the domestic digital asset sector.

The commission on “Australia as a Technology and Financial Center”, which submitted its first report in November 2020 and a second in April this year, has tabled its third and final report Tuesday. The document outlines the issues identified by key industry participants and includes 12 recommendations to address issues related to the lack of crypto and blockchain regulations in the country.

The regulation of cryptocurrency and blockchain technology in Australia has often appeared fragmented and haphazard, attempting to apply decades-old laws to nascent technology.

Taxation of cryptocurrencies, for example, while viewed as capital gains, inevitably “complicates” the implementation of crypto projects compared to competing jurisdictions like Singapore which have “favorable tax laws and regulations. do not have CGT ”, the committee heard from a witness.

Liberal Party Senator Andrew Bragg, who chairs the committee and is a strong supporter of digital asset innovation and regulation, said Australia would be competitive with Singapore, the UK and the US in his approach to crypto and blockchain technology.

“Australia can be a leader in digital assets,” said Bragg. “This means Australians can access new choices and lower prices. This means Australians can have more control over their financial destiny rather than depending on endless intermediation. “

Recommendations but no law yet

Recommendations range from implementing a licensing regime for crypto exchanges to establishing a custody or deposit regime for digital assets with minimum standards as part of the Treasury portfolio.

The committee also recommends that the Australian government establish a new decentralized autonomous organization (DAO) corporate structure.

“AML / CTF regulations and Financial Action Task Force guidelines must strike a balance between appropriate risk management, without implementing the travel rule in a way that compromises the operation of legitimate digital asset businesses.” , the committee said in its DAO report. .

The issue of bank removal, currently facing local crypto firms by big banks, was also discussed and said she understood the difficulty individuals and businesses face in making their issue public. , which, as the committee heard last month, puts them on a blacklist against other banks.

Last month the committee heard several complaints large financial institutions, including some of the largest banks in the country, denying or terminating services to local cryptocurrency and money transfer companies.

The committee heard that little or no reason had been given for the “debanking” and that the banks were “anti-competitive” because they “didn’t like there to be this competition through this bitcoin and other cryptocurrencies posed “.

The committee recommends that the Treasury conduct a “policy review” of the viability of a retail central bank digital currency in the country, in order to reduce reliance on the private banking sector.

After being tabled by the committee, the recommendations are now subject to action in the Senate, where they will be debated further until such time as the debates culminate in a bill that will be voted on in both the lower and upper houses. .

To view the full list of the committee’s recommendations, see here.

Read more: Australia has third highest cryptocurrency adoption rate in the world: Finder survey

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