Australia’s crypto industry is in a good spot to benefit from a global “inflection point” for crypto demand as long as its lawmakers make the right decisions, according to a Kraken Australia executive.
Speaking to Cointelegraph on the sidelines of the Formula One Grand Prix in Melbourne, Miller looked to the influx of fresh capital into spot Bitcoin exchange-traded funds (ETFs), stablecoin adoption and BlackRock’s recent move to launch a $100 million tokenization fund on Ethereum as reasons to take a bullish outlook on crypto in the coming months.
“We are now at a positive inflection point when it comes to demand. It feels like we’re well and truly back in a positive place for crypto,” said Miller.
“It’s all just proof that this is the financial services infrastructure of the future.”
Miller noted that while institutional demand for crypto had soared in the United States — with fund managers such as Fidelity and BlackRock instructing their clients to invest in Bitcoin — this was yet to make its way to Australia.
“We’re definitely not seeing that level of action in Australia, but it’s certainly a stepping stone toward that,” he said.
However, Miller explained there had still been a drastic uptick in interest from retail investors and crypto-related businesses in the country.
“We‘re still seeing quite an increase in adoption here. People are starting to invest again, and many are building new businesses around crypto as well,” he said.
“We’re seeing a lot of these businesses come to us specifically because they’re after liquidity,” added Miller.
Miller noted that many of the new Australian crypto businesses were focused largely on stablecoins, which he — like many others — described as the crypto industry’s “killer app.”
Related: Avalanche and Chainlink collaborate on Australasian on-chain asset settlement
To Miller, the biggest roadblock to domestic crypto adoption stems from the lack of regulatory clarity and relatively slow progress in legislation.
“It’s very hard to take risk and invest in the crypto space in Australia because there’s just that lack of certainty.”
However, Miller said his firm’s engagement with Australian policymakers had been largely positive so far, and now the main target was ensuring that sensible laws were put in place by the government.
“All of our engagement with [Australian] Treasury has been positive. Our next challenge is to kind of get the government to prioritize legislation. It’s very hard to do that, but I think we’re getting closer,” he said.
In October 2023, the Department of the Treasury released a consultation paper that proposed mandating crypto exchanges to apply for a financial services license from the Australian Securities and Investments Commission (ASIC).
On March 21, ASIC head Alan Kirkland said the regulator would focus on solving the “regulatory trilemma” — consumer protection, market integrity and encouraging financial innovation — when releasing the next round of regulatory reforms for the sector in the coming months.
Miller stressed that good legislation would need to take into account the international nature of crypto, and any attempts to make laws too specific to Australia could accidentally “overengineer localization.”
“You really don’t want to pull this fourth-dimensional money into three-dimensional space-time. At the end of the day, you want to keep it in its plane and then make sure the regulations actually mitigate the real risks,” he said.
Magazine: ‘SEAL 911’ team of white hats formed to fight crypto hacks in real time