“Token Mapping” in crypto and how Australia is changing the crypto regulation
Australia plans to review how cryptocurrency assets are managed this year by undertaking “token mapping” which has never been done before. The Labor government in Australia will itself carry out the process this year. This will be to keep the practice up to date and also look after the customers.
“Token Mapping” is a way of defining different types of digital assets that will group them all under the right regulatory framework. The plan to regulate the industry by improving consumer protection was advanced by a committee earlier in the year itself, as noted by Australia’s Treasury Department.
According to the Australian Taxation Office’s estimate, more than one million people have interacted with crypto-assets in an unregulated market. This data has been collected since 2018. The government is now aiming to change and upgrade the regulatory system.
The token mapping will primarily help classify tokens that are based on different asset types, considering their underlying code and other technological features.
This is particularly beneficial when it comes to defining different asset classes. The government will be able to regulate the industry better based on current laws and fill the gaps for the other asset classes that need specialized legislation.
The process of token mapping also involves revealing the characteristics of the asset tokens found in Australia.
Jim Chalmers also stated,
As it is now, the crypto sector is largely unregulated and we need to work a bit to find the balance so that we can embrace new and innovative technologies while looking after consumers.
Jim Chalmer further mentioned that this process of token mapping will help the authorities to work on licensing frameworks in a better way, taking into account the depository obligations of the exchanges along with providing additional customer protection.
Australia’s Labor government expressed regulatory intentions for the first time
It has been the first time ever that Australia’s new Labor government has voiced its intentions to introduce crypto regulations since its victory three months ago.
The idea behind this exercise is directly related to protecting consumers from market volatility while informing the public about the potential dangers associated with the crypto industry.
The government also referred to the crypto-advertisements that have partnered with major sporting events. This has also pressured the government to come up with a plan to strengthen the regulations.
Crypto.com had signed a sponsorship deal with the Australian Football League valued at $25 million in January. Swyftx which is a domestic exchange signed a three-year deal for an undisclosed amount in February.
