Australia Plans Major Revisions in Crypto Regulations by Early 2023

• The government plans to issue a discussion paper in early 2023.
• Australia wants to find a middle ground between innovation and crypto regulation.

Australia’s government said on Wednesday, December 14 that it is doing the necessary to enhance crypto service provider regulation. The government plans to issue a discussion paper in early 2023. In order to determine which kind of digital assets they want to regulate.

Moreover, the Australian government is contemplating major revisions to its financial services regulations in order to strengthen the country’s regulatory framework for the cryptocurrency industry. The new consultation document will be used as the foundation for Australia’s “strategic plan” for a payments system that is expected to be approved in the first half of 2023.

Increasing Oversight Over the Industry

Due to the crypto winter in 2022 and other occurrences, authorities have been compelled to increase oversight of the industry. The spectacular failure of FTX crypto exchange has revealed critical flaws that must be fixed quickly. Australia wants to find a middle ground between innovation and crypto regulation in light of recent events.

Treasurer Jim Chalmers of Australia commented:

“The one constant in finance is change. It’s fast moving, dynamic and our regulatory frameworks haven’t kept up. Our reforms are about starting to fix that in pursuit of a financial system that is stronger and more secure.”

The lack of adequate regulation of crypto custodians, crypto lenders, and other service providers is a serious problem for cryptocurrency consumers today. For this reason, the Australian government is thinking about adjusting crypto custody and licensing regulations to better protect customers.

Moreover, Australia is expected to have consultations on this framework in the next year before enacting crypto-related laws.