The country’s Treasurer, Jim Chalmers, said that his government will try to improve the way Australia’s system manages crypto assets and provide greater protections for consumers. The token mapping exercise was one of the 12 recommendations in a senate inquiry report in 2021 on. The report was warmly welcomed by the industry which has been anxiously waiting to see if the ALP government would embrace it.
Aimed at being conducted before the end of the year, the exercise is expected to inform future regulatory decisions. The Treasury will also undertake work on some of the other recommendations soon, including a licensing framework for crypto asset service providers dealing in non-financial product crypto assets, appropriate requirements to safeguard the consumer crypto asset custody, and a review of the decentralized autonomous organization (DAO) company-style structure.
The government says it wants to reign in on a largely unregulated crypto sector. The regulator wants to embrace new technologies and at the same time get the balance right between innovation and regulation.
The statement noted that more than one million taxpayers have interacted with the crypto ecosystem since 2018. At the same time, it can be observed that regulation is struggling to keep pace and adapt with the crypto asset sector.
The new government criticised the previous one for not understanding the crypto market. As a result, the new Treasury attempts to first have a good grasp of the subject before implementing any regulation. They want to have a better understanding of what risks need to be approached first.
As representatives see it, the token mapping exercise will be an important step to bridge the education gap between regulators and policymakers. This should help regulations be fit for purpose and both support innovation and jobs in Australia while protecting consumers.
There could be additional benefits to the token mapping idea, as Caroline Bowler, CEO of BTC Markets sees it. The move can provide greater clarity to crypto investors, aid companies in developing their own blockchain-based innovations, provide guidance to digital currency exchanges, as well as assist regulators in shaping an appropriate regulatory regime.
However, some suggest that the mapping exercise is something of a delaying tactic by the Labor government. As Aaron Lane, a senior lecturer at the RMIT Blockchain Innovation Hub sees it, the government just bought some time to allow itself to get up to speed with the emerging industry.
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