Australia To Make Regulatory Changes To Boost Security In Crypto Sector

Given the prevalence of scams and fraud in the crypto industry, governments of different countries are trying to protect their citizens. The FTX, Terra collapse, and other recent unfortunate occurrences have spurred authorities and lawmakers into action, looking for ways to curb the menace.

In light of the regulatory issues, the Australian government has taken steps to improve security in the crypto space. The government announced its plans to tighten regulations for crypto firms. In addition, the government plans to release a consultation paper to aid their decisions on the digital assets they want to regulate in 2023.

The Australian government will also reform the financial services laws for a more robust and secure digital asset space. The proposed consultation paper will be the basis of the country’s strategic plan for implementing the payments system come 2023.

New Regulatory Guidelines Down Under In 2023

In a statement to Bloomberg, Australian Treasurer Jim Chalmers commented on the government’s new approach. He said change is a constant in finance. According to Chalmers, the finance industry is dynamic and fast-moving, and the Australian regulatory framework has not been able to measure up.

The Treasurer added that the Australian reforms are beginning to fix the issues to achieve a strong and more secure financial system.

The collapse of FTX revealed the areas where the industry lacks oversight and forced regulators to step up their game in crypto regulation. Given the recent chaos in the industry, Australia wants to set up regulatory pathways to balance the growing crypto innovations.

Chalmers highlighted that the digital age brought new opportunities and risks to the finance system. Therefore the Australian government plans to create an opportunity for more innovations while ensuring adequate regulatory measures to keep consumers safe. It will also boost the safety of businesses and secure the digital ecosystem for all.

Regulation Of Crypto Custody And Licensing

Furthermore, the Australian government is considering improving oversight on crypto custody and licensing for added consumer safety.

The lack of clear regulations on crypto custodians, lenders, and other service providers has been a big problem in the cryptocurrency industry. Solving this problem will be a breakthrough in the Australian digital assets community.

Therefore, the Australian government has planned for 2023 to sweep the digital services sector clean and improve safety. Before introducing digital asset legislation, the government plans to set up a regulatory framework for the “by now, pay later schemes.” More countries will tread this path in 2023 after what transpired in the digital asset industry this year.

Meanwhile, The Financial Service Board has announced plans to release recommendations for global crypto standards in early 2023. According to the watchdog’s secretary general, Dietrich Domanski, the board seeks to address various risks within the digital asset space.