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Introduction
The Senate Economics Legislation Committee of Australia has opted not to pass the “Digital Assets (Market Regulation) Bill 2023”, a proposal brought forward by opposition senator, Andrew Bragg. Instead, they have suggested a more consultative approach, encouraging the government to continue discussions with stakeholders to sculpt more apt digital assets regulations in the country.
Party-Line Decisions and Reactions
The committee’s decision has seemingly been made based on party affiliations. Senator Andrew Bragg, hailing from New South Wales, voiced his displeasure at the decision. He pointed out that the current Labor government appears to be dragging its feet when it comes to cryptocurrency regulation.
Reasons for Rejection
Upon examination, the committee determined that the bill lacked the necessary specificity and clarity. Furthermore, the bill’s provisions didn’t align well with the ongoing strategies of the government. A standout criticism was that the proposed bill was not in line with international standards, thereby raising alarms about potential regulatory discrepancies and potential negative repercussions for the Australian digital asset industry.
Government’s Current Direction on Cryptocurrency
In contrast to Bragg’s bill, Prime Minister Anthony Albanese had earlier laid out a plan to release a consultation paper. Unveiled by the Treasury in February, this paper aimed to set the foundation for another consultative document, which would focus on establishing a structured licensing and storage system for digital asset service providers. However, this subsequent paper has yet to see the light of day.
Blockchain Australia’s Chair and a prominent Digital Assets Lawyer, Michael Bacina, weighed in on the delay. He highlighted the industry’s anticipation for the Treasury’s guidance on crypto custody and licensing. Bacina suggested that the upcoming consultation could benefit from the insights shared during the Senate Committee’s evaluation of Senator Bragg’s bill.
Central Bank’s Exploration into CBDC
Amidst the regulatory discussions, the central bank has been venturing into potential applications of a Central Bank Digital Currency (CBDC) tailored for Australia. Despite completing their pilot test, the bank communicated that any solid decision regarding the adoption of an Australian CBDC would likely be a consideration for the distant future.
Conclusion
As Australia grapples with the rapidly evolving landscape of digital assets, the need for robust and flexible regulations becomes paramount. While the path forward remains uncertain, the active involvement of various stakeholders hints at a comprehensive framework in the making.