Australian government expected to initiate cryptocurrency regulations next year amid FTX’s collapse

Australian government expected to initiate cryptocurrency regulations next year amid FTX’s collapse

Reportedly, the Australian government has doubled down on its aim for implementing a cryptocurrency regulatory framework post the FTX’s collapse in the previous week, as reported by Cointelegraph.

According to Cointelegraph, Jim Chalmers, spokesperson, Australian Treasurer, highlighted on the Treasury’s plans for regulations around investors’ protection next year, as mentioned by a November 16, 2022, report from the AFR. With regard to FTX’s collapse in the previous week, the spokesperson made the announcement emphasising on the fallout from the FTX collapse, “including further volatility in crypto-asset markets and any spillovers into financial markets more broadly.”  

“These developments highlight the lack of transparency and consumer protection in the crypto market, which is why our government is taking action to improve the regulatory frameworks while still promoting innovation,” Chalmers said. 

On the basis of information by Cointelegraph, the urgency behind fast-tracked regulations is due to those 30,000 Australians and 132 companies who have been victimised on account of Sam Bankman-Fried’s FTX collapse. 

“Regulatory certainty is key to rebuilding trust in relation to centralized exchanges, and while law cannot eliminate bad behavior, it can set powerful norms and standards which make that behavior easier to find. [But] the challenge will be ensuring that regulation does as intended to effectively protect consumers without suppressing industry growth,” Michael Bacina, digital asset manager, Piper Alderman lawyers, said. 

Moreover, Cointelegraph noted that Danny Talwar, head, Koinly Australia, a cryptocurrency taxation platform, emphasised on the Australian trading platforms’ compliance with Australian Transaction Reports and Analysis Centre, along with recommendations being put forward for creation of a market licensing regime. 

“When Australia brings in technology-enabling custody rules for centralized holders of crypto-assets, we will either be a leader in the space, or catching up, depending on how fast other jurisdictions, like Singapore and Europe, move to make rules,” Bacina concluded.

(With insights from Cointelegraph)

Also Read: Bitget launches five million dollars Builders Fund to help users hit by the FTX collapse

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