The Australian Center for Technology and Finance (ATFC) has released a report in which it proposes some regulations to regulate the burgeoning cryptocurrency economy. The report published twelve recommendations for the fintech industry and regulation of digital assets.
Like the rest of the world, the Australian government realized the need to regulate the world’s burgeoning cryptocurrency economy. In its new report, the Senate cryptocurrency exchanges, new laws governing Decentralized Autonomous Organizations (DAOs), correction of capital gains tax on Decentralized Finance, and some tax cuts for crypto miners using renewable energy.
The Senate drew attention to many different sides of the cryptocurrency economy in the country. According to the Senate, regulating the cryptocurrency economy alone will not be enough, but action plans should also be prepared to support innovations in this sector. According to reports, one of the most important recommendations made by the Senate was to create a new DCE Market License for digital currency exchanges.
The Senate wants to take its decisions carefully in order to keep the small operators in the market active in the market.
Taxation of Cryptocurrency Income and Recommendations on Mining
According to reports, an update to the tax rules is needed to provide more clarity to investors of crypto assets and DeFi staking method. Additionally, the committee warned that capital gains tax should only be applied when crypto transactions “result in a truly identifiable capital gain or loss.”
Like many other countries, Australia has drawn attention to the applicability of CBDC. Meanwhile, to tackle the environmental concerns that come with mining, the committee has proposed a 10% tax cut for miners using renewable energy.
It was noted that none of Australia’s current corporate structures include Decentralized Autonomous Organizations (DAOs). This regulatory uncertainty hinders the establishment of large-scale projects in Australia.
It is known that while the committee makes these recommendations, they also receive support from many different institutions and crypto money institutions. According to the tax office, around 60,000 taxpayers have invested in digital assets in recent years, and one report suggested that 17% of Australians currently own crypto.