The Australian Government Requests that Existing Financial Regulations Be Obeyed by Digital Asset Platforms.

The Australian Government Requests that Existing Financial Regulations Be Obeyed by Digital Asset Platforms.With a focus on improving oversight of customer funds, the Australian government has unveiled a proposal to impose stricter regulations...

The Australian Government Requests that Existing Financial Regulations Be Obeyed by Digital Asset Platforms.

The Australian Government Requests that Existing Financial Regulations Be Obeyed by Digital Asset Platforms.


With a focus on improving oversight of customer funds, the Australian government has unveiled a proposal to impose stricter regulations on cryptocurrency trading platforms.


According to a report by the Wall Street Journal, the proposal, which was unveiled on Monday, suggests putting digital asset platforms under the same legal restrictions as other providers of financial services.


Operators of crypto platforms will be required to obtain a financial services license as part of the plan, and customer funds will also be continuously monitored and periodically audited.


Australian Treasurer Jim Chalmers said in a statement that "the government is acting methodically to ensure that consumers are adequately protected and innovation can flourish.".


He added that the proposed rules are consistent with similar policies already in place in other jurisdictions.


Tighter Regulations are prompted by High-Profile Crypto Failures.


The recent failure of a few well-known cryptocurrency companies has highlighted the need for more stringent regulation.


For starters, the fall of the cryptocurrency exchange FTX in November 2022 exposed serious flaws.


According to the local bankruptcy administrator KordaMentha, at the time of its demise, FTX held a staggering 218.6 million Australian dollars (US$137.7 million) that belonged to 24,656 local customers.


It is important to note that FTX once held an Australian Financial Services license, which was subsequently suspended by authorities.


Sam Bankman-Fried, the founder of FTX, is currently on trial in the US.


Authorities claim that Bankman-Fried planned the theft of billions of dollars from clients, using the money for personal gain, business investments, and even political campaign donations.


Bankman-Fried has pleaded not guilty to all of the charges.


Australia is closely examining cryptocurrency.


Australia has recently become more concerned about cryptocurrency.


Back in May, cryptocurrency exchange Binance Australia informed customers that due to a decision by a third-party service provider, they would no longer be able to make deposits and withdrawals in Australian dollars.


Even the offices of Binance Australia were searched by Australian Securities and Investments Commission (ASIC) agents in July.


In addition, Australia's prudential regulator instructed banks to report their exposures to cryptocurrency companies and startups in March as a result of the failure of Silicon Valley Bank and the ensuing turmoil in the banking industry.


The APRA requested that local banks enhance their reports on cryptocurrency assets and send daily updates to the regulator in order to learn more about potential security holes in the system.


Blockchain Australia, an organization that represents the blockchain and digital currency industries in Australia, has introduced new initiatives to address the problem of crypto scams and frauds in response to the tightening regulations on cryptocurrency payments.


The organization will implement a number of initiatives under the new plan, including roundtable discussions and educational initiatives.


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