The Australian Senate Committee hopes its recommendations on cryptocurrencies will put the country on par with “leading jurisdictions”, including Singapore and the UK.
Australian Senate to review regulations on cryptocurrencies
An Australian Senate Selection Committee presents its final report on a year-long review of the country’s approach to cryptocurrency and blockchain regulation, aiming to guide, for the first time, a clear framework for the domestic cryptocurrency industry.
Presenting its first report in November 2020 and its second report in April of this year, the “Australia as a Center for Technology and Finance” committee presented its third and final report on Tuesday. The document outlines the issues identified by prominent industry participants and includes 12 recommendations to address issues related to the lack of crypto and Blockchain regulations in the country.
Cryptocurrency and Blockchain technology regulation in Australia has often appeared fragmented and haphazard as it attempts to apply decades-old laws to the nascent technology. For example, while taxing cryptocurrencies is considered a capital gain, it “inevitably complicates” the establishment of crypto projects compared to competing jurisdictions such as Singapore that “have the appropriate income tax laws and do not have the CGT,” the committee heard from a witness.
Andrew Bragg: Austria will be competitive in its approach to cryptocurrencies and Blockchain technology!
Liberal Party Senator Andrew Bragg, who chairs the committee and is an outspoken supporter of cryptocurrency innovation and regulation, said Australia will compete with Singapore, the UK and the US in its approach to cryptocurrencies and blockchain technology. Bragg’s statements were:
Australia can be a leader in cryptocurrencies. This means Australians can access new options and lower prices. This means Australians can have more control over their financial destiny rather than being dependent on endless middlemen.
Recommendations exist, but not yet law
Recommendations range from implementing a licensing regime for crypto exchanges to establishing a custody or custody regime for cryptocurrencies with minimum standards under the Treasury portfolio. The committee also recommends that the Australian government establish a new Decentralized Autonomous Organization (DAO) company structure. In its report on DAOs, the committee said:
AML/CTF regulations and Financial Action Task Force guidelines need to strike a balance between properly managing risks without enforcing the travel rule in a way that undermines the functioning of legitimate crypto businesses.
The issue of debanking currently facing local crypto businesses by major banks was also reviewed, saying it understands the challenge individuals and businesses face by going public and blacklisting them against other banks, as the committee heard last month. Last month, the committee heard several complaints from major financial institutions, including some of the nation’s largest banks, denying or terminating services to local cryptocurrency and remittance businesses.
From these complaints, the panel concluded that little or no reason was given for “debanking” and that banks were “anti-competitive” because they “didn’t like this competition coming from Bitcoin and other cryptocurrencies.” The committee also recommends that the Treasury conduct a “policy review” on the viability of individual Central Bank Cryptocurrency in the country to reduce reliance on the private banking sector.
The recommendations tabled by the committee will now be put to action in the Senate and debate until a bill is produced that will be voted on in both the lower and upper houses.
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