Australia’s Proposed Cryptocurrency Legislation
In a significant step towards regulating the cryptocurrency landscape, Australia has proposed legislation aimed at establishing a thorough regulatory framework for digital assets. According to government estimates, the new rules could lead to productivity increases amounting to $24 billion annually, while also enabling hefty penalties for firms that fail to adequately safeguard client assets.
Details of the Corporations Amendment Bill
This initiative, known as the Corporations Amendment (Digital Assets Framework) Bill 2025, was unveiled on Wednesday by Treasurer Jim Chalmers and Financial Services Minister Daniel Mulino. The bill is designed to create a structured set of guidelines that will govern entities managing crypto assets for their client base.
On the same day of its introduction, the bill was read for the first time in Parliament, with proceedings for its second reading beginning immediately after. This second reading phase typically allows for a broader discussion regarding the bill’s core principles before undergoing more thorough analysis. Officials emphasized the government’s recognition of the potential economic benefits that blockchain technology and digital currencies could bring to Australia’s financial ecosystem.
Industry Reactions
James Volpe, the founding director of the Melbourne-based Web3 education organization uCubed, commented on the bill, suggesting it represents a formative exploration into the regulatory landscape without obligating all initial projects to acquire licenses immediately.
The new bill outlines two distinct categories of financial products under the Corporations Act: digital asset platforms and tokenized custody platforms. Digital asset platforms are defined as those that manage clients’ crypto assets and facilitate transactions, including buying, selling, and staking activities. Conversely, tokenized custody platforms focus on managing traditional assets such as real estate and bonds, requiring licensed operators to secure each asset while offering clients a redeemable token.
Licensing and Compliance
To operate, these platforms must obtain an Australian Financial Services Licence and adhere to the Australian Securities and Investments Commission (ASIC) standards for custody and transaction management. However, platforms that qualify as low-risk—defined by client limits of $5,000 and total volume caps of $10 million—will be exempt from undergoing full licensing requirements. This provision for smaller and less risky platforms is intended to allow experimentation in the early stages without imposing stringent licensing conditions on all initiatives.
Concerns and Future Directions
The proposals follow ASIC’s recent update to guidance documents pertaining to custodial practices, funds management, and yield products. Notably, tokens and stablecoins are anticipated to be classified as financial products under existing regulatory frameworks. Yet, some experts remain skeptical about the practical implementation of these changes.
Darcy Allen, an RMIT University associate professor and director at the Digital Economy Council of Australia, raised concerns regarding the lack of clarity on compliance costs and the discretionary powers that will emerge from the new legislation, emphasizing that Australia risks falling behind in the global regulatory landscape of digital assets.
Industry insiders like Joni Pirovich, the CEO of crypto-focused master agent The Crystal aOS, echoed similar reservations, asserting that although the bill is a step in the right direction, substantial issues need addressing concerning definitions and the broader regulatory framework. Moving forward, there will likely be a push from the industry towards more comprehensive reforms that also clarify tax obligations related to digital assets.
