Cryptocurrency legislation in Australia could drag on beyond 2024 as the government seems to want to take its time getting a full picture of the industryinternal government documents have revealed.
The documents, obtained by The Australian Financial Review under freedom of information laws, reveal that the government intends to publish consultation documents in the second quarter of 2023 and that it will hold round tables with stakeholders on the licensing and custody of cryptocurrencies in the third quarter.
The industry has been waiting to see the next steps of the Australian Labor government’s token mapping exercise, which was announced three months after it came to power last year.; Submission of opinions closed on March 3.
Consultation open! Today we released the token mapping consultation paper. This consultation is part of a multi-step reform agenda to develop an appropriate regulatory setting for the #crypto sector. Read paper & submit views @ https://t.co/4W2msjhP9B @ASIC_Connect @AUSTRAC pic.twitter.com/OGHuZEGvDp
— Australian Treasury (@Treasury_AU) February 2, 2023
Open consultation. Today we have published the consultation document on token mapping. This consultation is part of a multi-step reform program to develop a suitable regulatory framework for the cryptocurrency sector. Read the paper and send your opinion to
However, According to the documents, final cabinet submissions are not expected until the end of the year, potentially delaying any decisions on crypto legislation until well into 2024 and beyond.
A department report has also acknowledged that they expect frustration from cryptocurrency companies and consumer groups over the long wait time.
“Treasury expects some stakeholders to be disappointed by the perceived delay in the application of a licensing regime”, according to a report by Australian Treasurer Jim Chalmers, seen by AFR.
“For example, consumer groups seeking immediate protections and companies seeking regulatory legitimacy.”
However, the Treasury believes that, Following the FTX collapse, demand for cryptocurrency has “significantly weakened,” which could give him more time to craft regulations.
“Treasury believes that these concerns are somewhat mitigated by current market conditions resulting in lower consumer demand for crypto assets; and the need to complete the token mapping exercise to provide clarity on how it would operate in practice any new licensing framework.”
For his part, The government has also revealed through the documents that it has created a dedicated “cryptocurrency policy unit” within the Treasury department.
In a meeting with the Treasury held last November, The cryptocurrency policy unit noted possible requirements for cryptocurrency licenses, including “fit and proper” tests, capital requirements, and obligations to report bad actors and scams in the sector. The unit also spoke of strengthening consumer protection.
Last year, a survey by Australian cryptocurrency exchange Swyftx revealed in September that approximately one million Australians planned to buy cryptocurrency for the first time in the next 12 months.which brought the total possession of cryptocurrencies in the country to more than five million.
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