A new bill has been submitted to the Australian Parliament proposing rules for the provision of cryptocurrency services in the country.
Senator Andrew Bragg introduced a private senators bill titled “Digital Assets (Market Regulation) Bill 2023” for “protect consumers and promote investors”, which includes regulatory recommendations for stablecoins, exchange licensing, and custody requirements.
Proposed regulatory changes are usually introduced by Australian ministers. However, as stipulated by the Office of Parliamentary Education, members of parliament can introduce bills from private members or private senators, which can take months or years to pass through parliament.
Bragg provided further background for the private bill filing, attacking the current Labor government for failing to follow 12 recommendations related to cryptocurrency regulation introduced by the Senate Select Committee on Australia as a Technology and Finance Center in October 2021.
The senator also added that Australian consumers had been exposed to industry-wide events such as the FTX collapse, by the inaction of the Australian Government in bringing regulatory clarity to the sector.
“Australia can be a hub for digital assets while protecting digital asset consumers. But we must act now.”
The law aims to establish a regulatory framework for cryptocurrency exchanges, custody services, and stablecoin issuers, protecting consumers and encouraging investment.
It is also intended to provide guidelines for reporting by authorized depository takers for the issuance and control of a central bank digital currency.
If passed, the bill will require a person or company to hold a license from the Australian Securities and Investments Commission or a foreign license to operate a cryptocurrency exchange. This would also apply to cryptocurrency custody services and stablecoin issuers in Australia.
The bill also lays out various obligations and requirements for exchanges, custodial services, and stablecoin issuers. These are minimum capital or reserve requirements, segregation of client funds, information on client holdings, audit, guarantee and disclosure agreements.
A public consultation is currently underway in Australia on the classification of cryptocurrencies and various digital asset platforms, services and tokens. In February, the “Token Mapping” consultation document was published, outlining the basic definitions of the cryptocurrency sector.
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