Australia Targets to Regulate Crypto Start-ups with Mandatory Financial Services Licences

ASIC commissioner Alan Kirkland said that many crypto asset firms in Australia will need licensing, as several crypto assets are regardded financial products under current laws.

Australia is poised to launch new regulations requiring the crypto industry to obtain financial services licenses under the Corporations Act.

On September 23, Australian Securities and Investments Commission commissioner Alan Kirkland said at an AFR Digital Assets Summit that many crypto-asset firms in Australia will need to be licensed. He stated that ASIC considers several crypto assets as financial products under existing laws.

ASIC’s regulatory framework focuses on “financial products,” which involve financial investments, risk management, or non-cash transactions. However, certain aspects of crypto don’t entirely align with this model. This creates uncertainty about whether specific crypto structures require licensing.

Kirkland confirmed that ASIC will release new draft guidance soon, and plans to invite industry feedback on these updates.

“Millions of Australians now hold crypto-asset investments and ASIC wants to make sure they have access to important consumer protections provided by the current regulatory regime” he said.

＼Trade On BTCC With 10 FREE USDT!／

Crypto Developers Bypass Licensing, Australia to Clarify Token Rules Amid Regulatory Concerns

Many crypto developers have not obtained Australian Financial Services Licenses (AFSLs), following legal advice. This decision is based on the belief that their investment products don’t fall under the purview of current laws, AFR reported.

To address that, ASIC plans to update guidance by November. This will clarify the classification and treatment of specific crypto tokens representing digital ownership rights and related products.

Further, Kirkland noted ASIC’s concern over potential consumer harm and market misconduct. He stated that licensing will help reduce risks, build consumer trust and protect market integrity.

ASIC Ramps Up Enforcement Efforts, Tightening Scrutiny on Crypto Sector

The Australian Securities and Investments Commission (ASIC) has intensified its enforcement actions, indicating a heightened level of oversight in the cryptocurrency industry. Recently, the agency took issue with Kraken, alleging that the platform failed to adequately educate its Australian clients on the inherent risks associated with margin trading, ultimately leading to significant financial losses for its customers.

Additionally, in a separate development, ASIC initiated legal proceedings against ASX in August, accusing the market operator of mismanagement in relation to the blockchain-based CHESS replacement project. These actions demonstrate ASIC’s commitment to holding crypto-related entities accountable for their conduct and ensuring a robust regulatory environment within the sector.

＼Trade On BTCC With 10 FREE USDT!／