The Australian government has said it will take steps to ensure the “regulation of crypto assets protects consumers” and one of these steps will be the reforming of “the licensing and custody of crypto assets.” The Anthony Norman Albanese-led government also said it has released a consultation paper that explores “which elements of the crypto ecosystem are sufficiently regulated and which require additional attention.”

Prioritizing Protection of Consumers

The Australian government has said it is working to “ensure the regulation of crypto assets protects consumers” as well as to position the economy “to take advantage of new digital products and services.”

To achieve these goals, the Aussie government said it plans to “reform the licensing and custody of crypto assets.” Special emphasis will be given to a subset of cryptocurrencies “that currently fall outside the financial services regulatory framework,” the government said.

In a statement issued on Feb. 3, the Anthony Norman Albanese-led government said it also intends to subject crypto asset service providers to what it calls “a set of obligations and operational standards.” The statement added that such standards are intended to safeguard customers’ digital funds.

Concerning the design of a custody and licensing framework, the Australian government said it will commence a public consultation process in “mid-2023 to allow for sufficient consultation prior to the introduction of legislation.”

Identifying and Controlling Emerging Risks

Also in the statement, Prime Minister Albanese’s government said while it has taken immediate steps to protect consumers, more needs to be done. The government added:

A consultation paper released today explores in detail which elements of the crypto ecosystem are sufficiently regulated and which require additional attention. This will enable the Government and stakeholders to focus on regulatory gaps and ensure that emerging risks are identified and controlled.

The statement also said while the Australian government is open to working with stakeholders it nonetheless wants this done in an orderly fashion. Doing this allows the government to “get the policy settings right to protect consumers and support innovation in this emerging sector.”

Besides the planned crypto custody and licensing framework, the Australian government said it has already taken steps to ensure consumers are protected. Some of these steps include increasing the size of the Australian Securities & Investments Commission (ASIC)’s crypto team. Stopping scams as well as detecting possible money laundering or terrorism financing are also listed as the other steps already taken.

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