Following a long-awaited report by a Senate committee on Australia’s fintech industry, the country’s treasurer, Josh Frydenberg, today announced sweeping new proposals aimed at updating the country’s payments sector — including cryptocurrencies. Speaking at the Australia-Israel Chamber of Commerce in Melbourne today, Frydenberg said the reforms being considered are the most significant in 25 years, as the treasury is considering requiring domestic crypto exchanges to hold digital assets for local clients on-shore, to introduce licensing regimes for exchanges and to reveal further details on the development of a central bank digital currency (CBDC) in the country.
“The call for regulation from the [Senate] report has set some wheels in motion, and it seems the treasury team are the ones that are going to be picking it up,” Jonathon Miller, Australian managing director of crypto exchange Kraken, told Forkast.News. “My hope here is that the way they look at this is as an emerging industry, not as an established one. Whether or not the custody regime maps to an existing asset class or not, it’s impossible to tell. But I would say that crypto remains a very unique asset class and needs probably its own unique treatment.”
While the recommendations announced today align with many of the recommendations made in the recent Senate Select Committee on Australia as a Technology and Financial Center report, one highly publicized one will not be adopted. The report had recommended offering a 10% tax concession to crypto mining operations that use 100% renewable energy, but that was knocked back despite industry enthusiasm. Forkast.News recently reported that Australia’s largest Bitcoin mining operation was set to open in Byron Bay and that it would be powered by 100% green energy. Spearheaded by local digital infrastructure company Mawson Infrastructure Group, Nick Hughes-Jones, CEO of the company, told local media the proposal helped justify building larger-scale projects in Australia.
Miller expressed disappointment that the proposal would not be adopted by the Australian government, which is regarded as having taken a conservative approach to climate policy in recent years. “It’s unfortunate that there hasn’t been some form of leaning in here to applying crypto to the renewable space; there’s a good opportunity there,” he said. “The recommendation was progressive and perhaps too progressive for this government.”