Crypto Assets  

A crypto asset is a digital representation of value that can be transferred, stored, or traded electronically. Currently, crypto assets have three primary uses: investment; as a means of exchange; and to access goods and services. Crypto assets include cryptocurrencies such as bitcoin.  

Treasury considers licensing  

In March 2022, Treasury issued a consultation paper considering potential licensing and custody requirements of crypto asset secondary service providers (CASSPrs). Entities who offer crypto asset custody, storage, brokering, exchange and dealing services, or operate a market in crypto assets for retail consumers are considered to be a CASSPr in the consultation paper.

Treasury requested feedback on proposed obligations on CASSPrs as well as mandatory, principles-based obligations for CASSPrs who maintain custody of crypto assets on behalf of consumers.  

CA ANZ provides feedback to Treasury  

In our submission, we emphasised that it will be key for Government, in partnership with industry, to develop regulations and address existing regulatory gaps to meet the needs of the economy, promote confidence as well as encourage innovation and future growth in the industry.  

A challenge for Government will be keeping pace with developments in the crypto asset space such as decentralised finance (DeFi) and protecting Australian consumers when they invest in crypto assets offered by foreign providers. Working with other overseas jurisdictions will be important to determine a collaborative approach and to limit the risk of regulatory arbitrage.  

We draw attention to INFO 269 which discusses financial products and services online for social media influencers and Australian Financial Services Licensees (AFSLs) using influencers. Given the amount of crypto advertising currently taking place through social media platforms, it would seem wise for regulation within this sector to be implemented sooner rather than later.