Australia To Adopt Tech-Neutral Method For Token Mapping

The Australian Treasury is implementing a token mapping framework to categorize digital assets based on their function and purpose. The token mapping framework aims to strike a balance between innovation and consumer safety, encouraging American and overseas digital asset entrepreneurs to examine the Australian market.

Token Mapping In Australia To Go Tech-Agnostic

According to a Treasury official, the Australian Treasury’s token mapping of digital assets will use a “principles-based” and “tech-agnostic” methodology to describe crypto assets.

At the Australian Blockchain Week on June 26, Trevor Power, an assistant secretary in the Australian Treasury, said the framework would be set up to make it simple to categorize tokens according to their “function” and “purpose.”

“The token mapping paper spends a lot of time talking about the token, the system, and the value delivered for the very purpose of trying to structure whatever regulation such that it draws on those principles so that a token can then be placed within that,” Power said. Overall, it tries to be tech-neutral. It doesn’t make an effort to be token-specific.

Power stated “it’s fair to assume” that legislation about cryptocurrency will be introduced at some point in 2024, but the outcome will depend on how Australian MPs will react to it. Power predicts crypto assets whose purpose and utility evolve will be reviewed.

They will advance via the regulatory system if they “become very significant”

He emphasized the law on token mapping will need to be “robust” to function in a “tech-neutral” and “principles-based manner” and take into account such modifications.

To understand how the cryptocurrency ecosystem interacts with Australia’s current financial regulatory frameworks, the Treasury believes token mapping is crucial.

Power said the United States Securities Exchange Commission’s (SEC) recent barrage of regulatory enforcement actions had no bearing on the token mapping effort.

Instead, Power aspires for a crypto framework to be more closely aligned with the Markets in Crypto Assets (MiCA) regulation of the European Union.

As long as they adhere to the token mapping framework, which seeks to strike a balance between innovation and consumer safety, Power also encouraged American and overseas digital asset entrepreneurs to examine the Australian market:

Every regulation-related element has two arms. The first is to ensure the structure is in place, and the second is to ensure there is space for industry to expand and innovate.

A consultation procedure was held by the Treasury between February 3 and March 3, nearly six months after the token mapping framework was unveiled on August 22.