• With this in mind, we should recall the October 2021 Senate report, which advocated a cryptocurrency framework approach. In addition to establishing a governance framework, the bipartisan proposal gave the Treasury Department the authority to regulate bitcoin exchanges as a financial marketplace licensee.
  • Under the proposal, a new framework would also replace the existing one-size-fits-all payment licensing arrangement with a function-oriented structure that would implement tiered, risk-based regulatory standards.
  • The Financial Supervisory Commission is continuing to look at regulation of different types of cryptocurrency assets, he said, adding that if privately issued stablecoins are the way things are going, then it will be crucial that they meet very high requirements.

As consumers turn to the cryptocurrency market, Australia's central bank governor Philip Lowe and ASIC chairman Joe Longo have sought to expand their powers to regulate the cryptocurrency market this year. According to local media sources, the Governor of the Reserve Bank of Australia has asked the government to process the petition immediately. This would provide the regulator with enough power to focus on the virtual asset space.

Even with increased consumer acceptance, the industry still needs reform

As part of this, Lowe has called for the adoption of a national plan to monitor the country's payment system. A Treasury Department study last year effectively made that recommendation. Dr. Lowe said at an event that the nature of money has evolved as technology has evolved and technology has evolved rapidly. Finance Minister Josh Frydenberg announced in the December 2021 review that the government would create a licensing framework for cryptocurrency platforms by mid-2022. Under the proposal, a new framework would also replace the existing one-size-fits-all payment licensing arrangement with a function-oriented structure that would implement tiered, risk-based regulatory standards.

It's no secret that as consumer interest in cryptocurrencies grows, new fintech companies are turning to providing cryptocurrency services. Regulators around the world are looking for a new way to keep up with the new age of technology in the banking industry. We need this program, and it has to be good, Dr. Lowe added. It needs broad support. Some important legislation must also be passed to ensure Australia is ready for future advances.

The regulator also wants the government to respond to the Financial Supervisory Commission's ideas on stablecoins. Governor Lowe has already warned investors in a speech about the dangers of investing in cryptocurrencies, especially stablecoins. He said the Financial Supervisory Commission is continuing to look at the regulation of different types of cryptocurrency assets, adding that if privately issued stablecoins are the way things are going, it will be crucial that they meet very high requirements.

Meanwhile, Shadow Treasurer Jim Chalmers writes in his paper that the current system lacks consistent governance to manage the complexity of the problem and the industry's frequent pace of innovation, meaning a Labour government needs to change the way it pays.

Cryptocurrency Framework

Chalmers said the reforms would empower regulators and promote regulation that is as flexible as the industry itself. With that in mind, we should look back to the October 2021 Senate report, which advocated a cryptocurrency framework approach. In addition to establishing a governance framework, the bipartisan proposal gave the Treasury Department the authority to regulate bitcoin exchanges as a financial marketplace licensee.

Longo called on lawyer Scott Farrell and a Senate committee chaired by Andrew Bragg to implement the recommendations as a matter of urgency. The ASIC chief said, In the short time I've been chair, I've been surprised at how quickly this phenomenon has grown and taken up a lot more time than I expected when I started. The standards are reportedly aimed at controlling not only pure cryptocurrency platforms, but also potentially regulating big giants such as Facebook and Apple.