Australia Targets Cryptocurrency, Clearing Sector in Financial Overhaul

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, Original Author: Harry Brumpton

Odaily Translator | Nian Yin Si Tang

Australia is set to overhaul its financial services laws, which will tighten the safety net for the cryptocurrency market and pave the way for possible competition in clearing equity trades.

The Australian government will examine which crypto tokens should be protected by financial laws and seek to strengthen Australia's payments system, according to a consultation paper outlined on Wednesday. On the cash equity front, the proposed legislation would either allow competition in clearing and settlement if ASX Ltd. emerges as a competitor, or give the regulator greater powers if its dominance continues.

"The only constant in the financial sector is change. It's fast-changing, dynamic and our regulatory framework has not kept up," Australian Treasurer Jim Chalmers said in a statement. to build a stronger and safer financial system."

The government said its consultation paper, published on Wednesday, would form the basis for a new "strategic plan" for the payments system to be adopted in the first quarter of 2023, with changes expected in other areas next year.

With the recent FTX bankruptcy highlighting major failures in risk control, regulators around the world are looking to tighten their grip on digital assets. Meanwhile, in Australia, the ASX, which has a monopoly on the clearing and settlement of share trades, is under pressure after years of abandoning a technology upgrade powered by blockchain technology.

Chalmers "The digital age has brought new opportunities and risks to the financial industry," Chalmers said. "Our plan is to open up space for further innovation, while ensuring we have the right regulatory approach to keep consumers, businesses and systems safe. "express", the Anthony Albanese-led government is "taking action to improve the regulation of cryptocurrency service providers and ensure additional safeguards for Australians".

. He added that the consultation paper will cover how certain cryptocurrency assets should be regulated, while also delving into the framework for company licensing, asset custody and consumer protection, which is expected to be consulted before legislation is introduced next year.

Under the plan, the government will create a regulatory framework for the so-called "buy now, pay later" sector, which will make it easier for companies to determine whether they need a licence.In addition, Australia's financial regulator is "examining options",Regulatory framework to incorporate payment stablecoins into stored value facilities