The Treasury of Australia is seeking responses to its latest consultation paper, exploring crypto assets in the Australian financial services regulatory context.
In August 2022 the Government announced that it would take a more serious approach to the crypto ecosystem, and that “token mapping” would be a “foundational step in the Government’s multi-stage reform agenda that commits to developing appropriate regulatory settings for the crypto sector.”
The paper explains that “token mapping is the process of identifying the key activities and functions of products in the crypto ecosystem and mapping them against existing regulatory frameworks.”
It notes that token mapping is a key first step to planned and future crypto ecosystem initiatives and will:
(a) ensure consistency in regulating activities (i.e. be technology neutral)
(b) facilitate existing policy goals (i.e. not require the wholesale creation and adoption of a standalone policy that may overlap or conflict with existing policy)
(c) allow responsible actors to innovate with appropriate regulatory oversight
The paper cites research that Australia now ranks 40th globally for crypto adoption, and that that the turbulence and volatility seen in crypto markets over the past year raises the risk that losses in the sphere could impact the broader economy.
The Government is seeking feedback from stakeholders on this paper until the 3rd of March 2023. After token mapping has been addressed, the Government plans to focus on licensing and custody reforms, and will publish a consultation paper proposing a licensing and custody framework for crypto asset service providers in mid-2023.