Australia is Setting a New Standard in Crypto Regulation

Australia is setting a new standard in crypto regulation. In a statement released today, the Australian treasury announced a multi-step innovation to establish a new crypto regulatory framework that they claim will be more in-depth and better researched than any already based “anywhere else in the world.”

Pivotal to this new regulatory framework is a form of crypto research called “token mapping.” Token mapping will enable officials to evaluate trends in the Australian crypto markets to “identify how crypto assets and related services should be regulated.”

A statement from Jim Chalmers, Australia’s Treasurer under Prime Minister Anthony Albanese, stressed the importance of intuitively understanding cryptocurrency before establishing regulations.

“The previous government dabbled in crypto asset regulation but prematurely jumped straight to options without first understanding what was being regulated,” said Chalmers. “The Albanese Government is taking a more serious approach to work out what is in the ecosystem and what risks need to be looked at first.”

Chalmers’ predecessor, Treasurer Josh Frydenberg, stated in December 2021 that he had plans to take crypto “out of the shadows” by making an extensive crypto regulatory framework. Though in May Frydenberg and the rest of Prime Minister Scott Morrison’s government were voted out during the federal election.

The Albanese government now states that its new approach to crypto will be more cautious, nuanced, and research-heavy than the previous administration. But this approach may be less groundbreaking than its letting on.

Last December, Frydenberg’s Treasury Ministry released a “Transforming Australia’s Payments System” report that committed to a similar token mapping program by the end of 2022. The results from that research and the other consultations and reports were meant to inform upcoming crypto laws.

According to today’s statement, the Albanese government’s token mapping project will “identify notable gaps in the regulatory framework, progress work on a licensing framework, review innovative organizational structures, look at custody obligations for third party custodians of crypto assets, and provide additional consumer safeguards.”

The Albanese government did not release the date when they believed the new legislation would be enacted.

As more governments accept crypto as an established technology, laws and regulations will become pivotal to its potential growth, especially in its worldwide continuity.