The federal government is considering new legislation aimed at regulating and building Australia’s growing involvement in the cryptocurrency sector.
A new Digital Services Act will “signal that we fully appreciate the promise and potential of blockchain technology”, Senator Andrew Bragg said in a speech this morning.
The government will release its consultation paper today on a “licensing and custody regime for digital assets” which will inform a Board of Taxation review due by the end of the year.
The legislation would “make Australia one of the only jurisdictions confronting the issue head-on”, Senator Bragg (pictured below) said.
“We want to encourage innovation in crypto assets,” says says Jane Hume, Minister for Superannuation, Financial Services and the Digital Economy. “Innovation creates jobs and growth. There are so many innovative use cases for crypto assets, many of which are not far at all away from becoming mainstream. These include international payments, lending and borrowing, NFTs and asset tokenisation.”
“Cryptocurrencies and assets are a global phenomenon, and as more Australians invest in these new asset classes and embrace the new technologies underpinning them, it is critical that we have a robust and competitive tax and regulatory regime in place. Tax certainty for investors and those transacting will also be vital,” Treasurer Josh Frydenberg said.
This is a bullish move to keep influence and profits in the country, and away from the overseas fintech giants that have infiltrated digital currency wallets and banking adjacent technology in Australia.
“The tech giants – the largest digital platforms – have transformed from tools that index content or enable communication to surveillance platforms and gatekeepers of innovation,” says Hume.
“The rules of the game could change at any time and devastate their entire business model. This uncertainty stifles innovation.
“Web3 will address these problems and provide alternatives and counterbalances to the power of big tech. It will be open, trust less and permissionless. Where users become the owners. Think Wikipedia rather than Encarta Encyclopedia.
“Crypto assets are a powerful way to develop consumer-owned networks. They provide a level playing field and don’t change the rules. Platforms and apps built on Web3 will not be owned by a central gatekeeper, but rather by users who will earn their ownership stake by helping to develop and maintain those services.”
Senator Bragg said a Digital Services Act would involve “regulation by a minister, not bureaucratic agencies”.
