Australia's cryptocurrency industry has largely expressed support for the government's draft legislation concerning digital assets, which was released last month. However, cryptocurrency exchanges have submitted consultation responses requesting additional clarity on several key regulatory provisions. The Treasury concluded its consultation period on Friday, having received feedback from major industry participants.
Industry Concerns and Support
Caroline Bowler, former CEO of crypto exchange BTC Markets, noted that the draft legislation leaves some critical questions unanswered. She emphasized that while the industry supports bringing structure to the digital asset sector, this structure must be accompanied by clear operational guidelines and implementation frameworks.
Crypto exchange Swyftx informed the Treasury in its submission that the draft law requires simplification and clarification, particularly concerning the powers granted to government regulators and the operational procedures for exchanges under the new framework. The company expressed concern that the legislation allows a high degree of discretion for the Treasury and enables regulators to impose fundamental changes.
Swyftx recommended that the law should include a statement to guide future regulatory interpretation and clearly delineate the powers of the Treasury and the Australian Securities and Investments Commission (ASIC) in designating platforms and setting minimum standards. The exchange also pointed out that the draft laws do not provide sufficient clarity on how Australian crypto platforms can legally source liquidity from offshore exchanges.
Regulatory Framework and Potential Impact
The draft law proposes the creation of two new financial products under the Corporations Act: a "digital asset platform" and a "tokenized custody platform." Both of these classifications would necessitate an Australian Financial Services License and registration with ASIC.
Mandy Jiang, executive director and financial chief at blockchain firm CloudTech Group, described the draft laws as a significant step forward. However, she also noted that many critical details are delegated to ASIC for future guidance. According to Jiang, the effectiveness of the legislation in achieving its stated objectives of fostering innovation and supporting sectoral growth will largely depend on the timeliness and quality of ASIC's forthcoming guidance.
CloudTech Group raised concerns that the proposed laws do not permit licensed financial advisers to provide direct guidance on cryptocurrencies, only allowing them to advise on regulated platforms that offer crypto services. This limitation could potentially restrict consumer access to professional financial advice within the digital asset space.
Industry Priorities and Timelines
Jason Titman, CEO of Swyftx, stated that the company supports regulating crypto under financial services law. He emphasized that the main priority is ensuring appropriate protection for Australian consumers while simultaneously allowing the local industry to compete on a level playing field.
Bowler added that the legislation introduces multiple licenses without clearly articulating the specific consumer benefits or the particular risks it aims to address.
Vakul Talwar, general manager for Australia at Crypto.com, urged the Albanese government to maintain momentum and work towards amending and introducing a bill as quickly as possible. He predicted that legislation could be introduced as early as March, noting that the bill is likely to receive bipartisan support, which would prevent significant delays due to debate.
Edward Carroll, head of global markets at crypto investment firm MHC Digital Group, offered a different perspective, suggesting that legislation might not be introduced before the end of 2026. He acknowledged that substantial work remains in translating consultation feedback into a workable bill but stressed that the sooner rules are formalized, the sooner businesses can plan with greater confidence.