New Regulations on the Horizon

Australian regulators are preparing to introduce new legislation requiring cryptocurrency exchanges to obtain financial services licenses.

The Australian Financial Review (AFR) reported this significant development, indicating that the licensing requirements will extend beyond those currently associated with digital currency exchanges.

ASIC's Perspective

Alan Kirkland, commissioner at the Australian Securities and Investments Commission (ASIC), underscored the necessity of these new requirements.

He stated that the Corporations Act already captures most major crypto assets, such as Bitcoin and Ether. Kirkland disclosed these plans during the AFR Crypto and Digital Assets summit held in Sydney on September 23.

"ASIC's message is that a significant number of crypto asset firms in the Australian market are likely to need a license under the current law," said Kirkland. "This is because we think many widely traded crypto assets are a financial product."

Upcoming Guidance

The ASIC is preparing to update the Corporations Act's Information Sheet 225 to provide more clarity. This update aims to elucidate how particular crypto tokens and certain products should be treated from a regulatory perspective. Kirkland mentioned that this updated guidance would be released in November.

Timeline for Implementation

According to the report, the new legislation is expected to be issued by November 2024. This gives crypto exchanges in Australia a timeline to prepare for compliance with the upcoming regulations.

The ASIC's proactive approach highlights the evolving nature of the crypto market and the need for robust regulatory frameworks.

A Developing Story

This story is still developing, and further information will be added as it becomes available. Australian regulators' move marks a significant shift in how the country approaches the regulation of cryptocurrency exchanges.

Stakeholders in the crypto market will need to stay tuned for more updates and prepare for the impending changes.