Australian senator releases draft bill to push for crypto regulation

Australian liberal senator Andrew Bragg released a draft bill to provide regulation of stablecoins, digital asset exchanges, and disclosure requirements for the Chinese CBDC, e-Yuan, on Sept. 19.

The draft bill, titled “Digital Assets (Market Regulation) Bill 2022”, welcomes stakeholder consultation before its clearance on Oct. 31.

Braggs explained that Australia is falling behind the rest of the world in consumer protection and investment promotion while he lays the groundwork for crypto regulation in the country.

Licensing requirements

The new rules will require digital asset exchanges, custody service providers, and stablecoin issuers to hold recognized foreign licenses.

Such licenses must comply with digital asset custody requirements, which include the designation of key personnel in Australia responsible for operating the digital asset custody services, as well as adhering to minimum capital and following auditing, assurance, and disclosure procedures.

Further, stablecoin issuers must hold the face value of their liabilities. They must be kept in reserve with an ADI in Australia in the form of Australian dollars or a foreign national currency.

Digital e-Yuan reporting requirements

The draft bill states that Chinese state-owned banks that facilitate the availability or use of the digital e-Yuan must report on Australian businesses that accept e-Yuan payments, the number of digital wallets facilitated by the designated bank, and the total amount held in these wallets.

APRA and the Reserve Bank of Australia are required to provide annual reports based on reports from Chinese state-owned banks for the Minster and the Parliamentary Joint Committee on Intelligence and Security.

The state of crypto regulation in Australia 

On August 2022, Labour Party’s Treasurer Jim Chalmers announced a multi-step plan to establish a crypto regulatory framework for industry and regulators.

The Treasury will carry out a “token-mapping” exercise, which involves conducting research on how cryptocurrency and related services should be regulated. The Treasury will release a public consultation on “token-mapping” results “soon.”