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Australia to reform crypto rules in an overhaul of the payments industry

Australia

TL;DR Breakdown

  • Australia intends to form a licensing framework for the digital market.
  • The state is also considering the establishment of a retail central bank digital currency.

Australia is considering establishing a central bank-issued digital currency to reform the crypto market. They want to revamp their payment system in a quarter of a century. Treasurer Josh Frydenberg is expected to give details of reforms. The changes would give him greater powers. Currently, the country runs under rules designed about three decades ago.

The state will also broaden its payment laws to cover online transaction providers. These firms include Apple Inc, Alphabet Inc’s Google, and buy-now-pay-later (BNPL) providers such as Afterpay Ltd.

Revamping Australia’s payment systems

The state will consult on a digital version of cash that will be universally accessible. At the same time, it will consider regulating the digital market through a better licensing framework. This will halt platforms from running their operations without direct supervision.

The government will uncover digital assets to revamp and modernize Australia’s payment systems. Furthermore, the comprehensive payments and crypto-asset plan will place the state at the forefront of global competition. 

The regulations will bring to light the services and products that can be regulated. According to Frydenberg, digital assets will be in a top universal regulatory framework. The treasurer said this while speaking to 7NEWS Australia.

Platforms that trade crypto will protect their customers through mandatory licensing. The government will also lay out a clear licensing plan for crypto exchanges. According to the Australian Financial Review, they will do this in 2022.

Staying at the top

The treasury will collaborate with the central bank on a digital currency. A few months ago, an official from the Reserve Bank of Australia said no strong case exists for a CBDC in the state. Frydenberg said that the country needed to stay ahead as the global crypto assets were now worth US$2 trillion. 

They need to leverage the new technology. The central bank will establish a CBDC to stay ahead of global competition.

According to reports, almost one million Australians own digital assets. However, this figure is very low since the figure is just under 5% of the population. Frydenberg notes that the new reforms will keep them at the forefront of innovations. 

He believes that if Australia embraces these developments, it will open doors to greater opportunities. They will capitalize on the convergence between finance and technology.

Australia’s Senate established a committee to research crypto regulations earlier this year. The team submitted a report to legislators at the end of October.

Edith Muthoni

Edith Muthoni

Edith is an investment writer, trader, and personal finance coach specializing in investments advice around the fintech niche. Her fields of expertise include stocks, cryptocurrencies, blockchain, and cryptocurrency investments.

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