Internal documents reveal Australia’s potential timeline for crypto legislation: Report
Crypto legislation in Australia could be dragged out beyond 2024 and beyond, with the government apparently wanting to take its time to get a full picture of the industry, internal government documents have revealed.
The documents, obtained by The Australian Financial Review under freedom of information laws, reportedly reveal the government aims to release consultation documents in the second quarter of 2023 and will hold stakeholder roundtables on crypto licensing and custody in the third quarter.
The industry has been waiting to see the next steps in the Australian Labor government’s token mapping exercise, which was announced three months after it came to power last year, with submissions closing on March 3.
Consultation open! Today we released the consultation document on token mapping. This consultation is part of a multi-stage reform agenda to develop an appropriate regulatory framework for #crypto sector. Read paper and submit views @ @ASIC_Connect @AUSTRAC pic.twitter.com/OGHuZEGvDp
— Australian Treasury (@Treasury_AU) February 2, 2023
However, according to the documents, final submissions to the Cabinet are not expected until late in the year, possibly dragging out any decisions on crypto legislation well into 2024 and beyond.
A briefing from the department also reportedly acknowledged that it expects frustration from crypto businesses and consumer groups over the long schedule.
“Treasury expects some stakeholders to be disappointed by the perceived delay in implementing a licensing regime,” according to a brief from Australian Treasurer Jim Chalmers, seen by the AFR.
“For example, consumer groups seeking immediate protection and businesses seeking regulatory legitimacy.”
However, Treasury believes that in the wake of FTX’s collapse, demand for cryptocurrencies has “weakened significantly”, which could give it more time to hash out regulations.
“Treasury considers that these concerns are somewhat mitigated by the current market conditions resulting in less consumer demand for cryptoassets; and the need to complete the token mapping exercise to provide clarity on how any new licensing framework will work in practice.”
Related: Australia strengthens crypto watchdogs in ‘multi-stage’ plan to fight fraud
Meanwhile, the government has also revealed through the documents that it has created a dedicated “cryptopolicy unit” in the Ministry of Finance.
In a meeting with the Treasury last November, the crypto policy unit reportedly flagged possible requirements for crypto licenses, including “fit and proper person” tests, capital requirements and obligations to report bad actors and fraud in the industry. The unit also discussed strengthening consumer protection.
Last year, a survey by Australian crypto exchange Swyftx revealed in September that approximately one million Australians planned to buy cryptocurrency for the first time in the next 12 months, bringing total crypto ownership in the country to over five million.
