Amid a broader push by Australian regulators to enhance oversight of the rapidly evolving digital asset market, crypto exchanges will soon face new regulations. Under the proposed rules, all crypto firms will be required to obtain financial services licenses, ensuring that they operate within a robust regulatory framework.

The Australian Securities and Investments Commission (ASIC) is leading this initiative, expressing concerns that current regulations are insufficient to address the complexities of popular cryptocurrencies like Bitcoin and Ether. These concerns were voiced by Commissioner Alan Kirkland during his speech at the AFR Crypto and Digital Assets Summit in Sydney on September 23, 2024.

Kirkland noted that many widely traded cryptocurrencies already fit the product definition under the existing Corporations Act. “This brings digital assets under the current regulatory regime and highlights the need for specific guidance on how it should be applied, as well as whether additional regulatory powers are required to effectively monitor and enforce compliance,” he said.

The proposed regulations will require crypto exchanges to obtain financial services licenses if they wish to continue operating within Australia. This shift is designed to align crypto firms with the regulatory standards applied to traditional financial institutions, particularly concerning transparency, consumer protection, and anti-money laundering requirements.

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ASIC’s goal is to integrate the crypto sector into established regulatory frameworks, believing that this approach will foster a more trustworthy and stable development of the digital asset market. Forcing crypto exchanges to hold financial services licenses is seen as a critical step toward improving safety for both consumers and investors, as Australia works to finalize its regulatory approach to the rapidly growing crypto industry.

Source: bitcoinsensus.com

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