The Australian cryptocurrency industry is striking a cautious tone as new regulatory measures loom on the horizon. On Wednesday, the Australian Securities and Investments Commission (ASIC) unveiled a proposed framework of rules designed to oversee companies operating in the digital assets space, setting the stage for significant changes to the sector.
Under the proposed regulations, cryptocurrency companies would be required to obtain an Australian Financial Services Licence (AFSL). ASIC plans to offer a grace period for operators to apply for licences, during which they would be shielded from enforcement actions. However, companies that choose not to comply will be required to explain their reasoning to the regulator. The finalised rules are expected to be released by mid-2025.
The move has sparked mixed reactions within the industry, with some backing the idea of constructive dialogue while others warn of potential challenges. Swyftx, a prominent Australian crypto operator, expressed cautious support for ASIC’s approach. CEO Jason Titman welcomed the opportunity for ongoing discussions with policymakers and regulators, stating that the company would review ASIC’s guidance in the coming weeks.
“We’ve seen a kind of ‘glasnost’ in our conversations with senior politicians over the last few months,” Titman noted. “There’s a general acceptance that a sensibly regulated blockchain industry can support productivity and innovation.”
However, Titman also raised concerns about the far-reaching implications of the proposed measures. These include requirements for audited prospectuses and treating cryptocurrency exchanges as bourses, akin to traditional financial markets. “We’re not aware of any other countries that regulate exchanges as bourses,” he said. “Rightly or wrongly, Australia is going it alone. Scale is going to matter, and I’d expect to see a wave of industry consolidation.”
The Albanese government has yet to present its legislative framework for the crypto sector, despite flagging plans for regulation over a year ago. Treasurer Jim Chalmers underscored the government’s commitment to striking a balance between regulation and innovation.
“We take the crypto industry seriously, and we know that blockchain and digital assets present big opportunities for our economy, our financial sector, and innovation,” Dr. Chalmers said. “Getting the balance right on the regulation of digital assets is part of building a dynamic and competitive economy. We’re closely watching developments worldwide.”
With the crypto sector at a crossroads, industry stakeholders remain focused on how these regulations will shape Australia’s role in the evolving digital economy. The months ahead will likely determine whether the industry can adapt to a more regulated environment or face significant consolidation.
