Australian Crypto Industry Urges Labor Government to Prioritize Digital Asset Legislation
2min read The Australian crypto industry has called on the newly reelected Labor government to urgently prioritize digital asset legislation to ensure Australia does not fall behind global markets. The incumbent Australian Labor Party secured 54.9% of the two-party-preferred vote, while the Liberal and National Parties garnered 45.1%. Both parties campaigned on crypto law reform, but only the opposition pledged to deliver draft legislation within 100 days.
Joy Lam, Binance’s head of global regulatory and APAC legal, emphasized the urgency of the situation, noting that discussions and consultations have been ongoing for years. She highlighted that the UK has released its draft regulations, stablecoin bills are advancing in the US, and the EU has implemented its MiCA legislation. Lam stressed that the time for action is now to provide a sustainable regulatory framework for the industry.
Coinbase managing director for APAC John O’Loghlen urged the reelected Albanese Government to establish a Crypto-Asset taskforce within its first 100 days. This taskforce would aim to develop legislation that protects consumers, promotes innovation, and prevents the loss of talent and capital to other markets. BTC Markets CEO Caroline Bowler also noted that the election result sets the stage for meaningful progress in Australia’s approach to digital asset regulation.
Treasurer Jim Chalmers’ office confirmed that exposure draft legislation would be released for consultation sometime this year. Any legislated reforms would be phased in over time to minimize disruptions to existing businesses. However, Lam expressed uncertainty about the specific timeline for the release of the draft legislation scheduled for the end of June.
Industry figures have observed a positive shift in the government’s approach to crypto, moving from initial proposals to a more supportive “Statement on Developing an innovative Australian digital asset industry” released in March. This statement outlines key priorities, including the use of the existing Australian Financial Services License (AFSL) regime to regulate Digital Asset Platforms and payment stablecoins. It also focuses on the safe custody of client assets by centralized providers and avoids issues around decentralized finance platforms.
Lam welcomed the use of the AFSL regime, noting that it is a sensible move that regulators are familiar with. The government will also review the Enhanced Regulatory Sandbox to support innovative digital asset startups and explore opportunities with tokenization. Lam acknowledged that the government has been responsive to industry feedback and has learned from the experiences of other jurisdictions.
Dea Markovy, policy director at Fireblocks, noted that much of the groundwork and research has already been done, and the overall outlook is positive. The securities regulator ASIC released its own crypto regulations proposals in December, which will inform the government’s new legislation. The draft guidance suggests that NFTs, in-game assets, and memecoins are not financial products, while yield-bearing stablecoins or gold-backed tokens likely are.
The Treasury statement also addressed issues with debanking, noting that simply regulating the industry would help mitigate risks and provide comfort to banks. Lam emphasized the need for a clean licensing framework and additional guidance for banks to address these concerns. Overall, the industry is hopeful that the newly reelected government will take swift action to implement much-needed crypto law reforms.
