For some folks, cryptocurrencies are complex and high-risk assets, which makes them hard to comprehend despite their potential. This limitation has posed challenges for several governments while seeking regulatory clarity for crypto. The same issue has been weighing on Australian authorities planning to release clear legislation for cryptocurrencies.
According to a new report, the Australian Treasury Department revealed a new timeline for crypto legislation in the country. The internal document noted that releasing Australia’s crypto legislation could extend beyond 2024, as the government wants to study the industry extensively before making decisions.
Decisions Regarding Australian Crypto Legislations Could Take Time
The Australian Financial Review obtained some documents under the Freedom of Information Laws which showed that the government aims to roll out consultation papers in the second quarter of 2023. The authorities would also hold roundtable stakeholders meetings in the third quarter of 2023 to discuss issues regarding licensing and custody of digital assets.
The digital asset industry has been anticipating the Australian government’s next step in the token mapping exercise announced in August 2022.
The Australian Treasury Department announced on February 2 that it released the token mapping consultation paper. The department also said it is open to consultations to help the government understand the digital asset sector and develop an appropriate regulatory framework for digital assets.
The consultation process ended on March 3 for the public, but the final submissions to the cabinet will not happen until later in the year. This delay in the final submission to the cabinet could drag the decisions on digital legislation to 2024 or beyond.
According to reports, a briefing from the Department of Treasury acknowledged that they expect the mapping exercise to be challenging. The Australian Treasurer, Jim Chalmers, said they expect complaints from digital businesses and consumer groups over the long timeline in implementing the licensing regime.
He noted that consumer groups seeking immediate protection and businesses looking to obtain regulatory legitimacy would find the delay frustrating.
Moreover, the token mapping could take a long time as the Treasury considers the current market conditions, reducing the demand for cryptocurrencies. The Australian government revealed it created a crypto policy unit within the Treasury Department.
However, the Treasury considered the risks associated with digital assets, which the FTX collapse magnified, and calls for a meticulous approach to regulations as the demand for digital assets has become low.
In a meeting with the Treasury in November 2022, the digital asset policy unit highlighted possible requirements for digital licenses. These requirements include capability/capacity tests, capital or financial constraints, and obligations to report bad players and scams in the industry. The unit also discussed tightening consumer protection policies.
More Australians Could Own A Crypto Following The Legislation
In September 2022, an Australian crypto exchange called Swyftx conducted a survey. The survey revealed that about 1 million Australians want to buy a cryptocurrency for the first time over the next 12 months, while 4.2 million already own crypto assets. This observation brought the total digital currency ownership in the country to over five million.
There’s no telling exactly what will happen when the Australian government finally releases the digital asset legislation. But it would grant regulators the needed framework and clarity to oversee the digital industry. Chances are also high that it might steer the digital asset mainstream adoption in Australia.
Featured image from Pixabay and chart from Tradingview