Australia’s ASIC moves to streamline stablecoin rules – Details

Key Takeaways

What change has ASIC made?

ASIC now allows intermediaries to distribute the AUDM stablecoin without holding multiple financial licences.

Is this permanent?

No. The exemption ends on 01 June 2028, unless extended.

The global contest to dominate the stablecoin market is intensifying, with countries racing to position themselves as industry leaders.

Following the momentum sparked by the passage of the GENIUS Act in the United States, Australia has stepped up its game.

New licensing exemptions on the cards

The Australian Securities and Investments Commission (ASIC) is in the news today after it unveiled new licensing exemptions for intermediaries distributing stablecoins issued by licensed entities.

Under the newly introduced ASIC Corporations (Stablecoin Distribution Exemption) Instrument 2025/631, intermediaries involved in distributing certain stablecoins will no longer need to hold multiple Australian financial licences.

Specifically, the exemption applies to distributors handling the AUDM stablecoin, issued by Catena Digital Pty Ltd, provided the issuer itself already holds an Australian financial services (AFS) licence.

Ordinarily, participants engaging in stablecoin-related activities, whether operating financial markets, providing clearing and settlement services, or offering financial advice, would be required to secure separate licences.

However, the new instrument simplifies this framework by lifting those requirements for distributors of AUDM. It significantly lowers regulatory hurdles for intermediaries.

Why is this update important?

According to reports, the exemptions span several key areas. For starters, the distributors will not need a market licence simply because AUDM qualifies as a financial product.

Likewise, clearing and settlement activities involving AUDM will not trigger licensing obligations.

Additionally, distributors will be exempt from obtaining a financial services licence when offering general advice about AUDM, trading it (other than by issuing), making a market, or providing custody services.

Worth noting, however, that the relief comes with an important safeguard.

Distributors making use of these exemptions must ensure that retail clients have access to the current Product Disclosure Statement (PDS). The PDS requirement is designed to uphold transparency, informing consumers about the risks, features, and costs of the stablecoin.

Also, the exemptions are not permanent. The instrument will automatically lapse on 01 June 2028, unless ASIC decides to extend or replace it.

This temporary timeframe gives regulators flexibility to review the impact of the framework and make adjustments as the stablecoin market continues to evolve.

Australia’s crypto adoption and more

Compared to gloabl adoption levels, the number of Australians holding cryptos remains relatively low. 

And yet, the demand is evident, with a recent Binance survey highlighting the frustration with banking restrictions amid growing calls for easier access.

At the same time, regulatory clarity abroad is shaping a more competitive landscape too. 

The U.K’s recent pivot towards stablecoin frameworks and innovation sandboxes is just an example of how global cooperation is now accelerating.

Together, the U.S and U.K. influence over a third of the world’s financial system, giving their policy direction significant weight.

Therefore, as these jurisdictions push forward, Australia faces mounting pressure to not only embrace innovation, but to also remove barriers to crypto adoption.