Recently, Treasury outlined its vision for the future in a consultation paper titled “Regulating Digital Asset Platforms,” which aims to formulate a regulatory framework for entities facilitating access to, and holding of digital assets for Australians and local businesses.
Driven by the competing (and sometimes conflicting) objectives of mitigating consumer-associated risks and promoting innovation in digital assets and emerging technologies, the paper outlines the design of a secure digital asset ecosystem encompassing critical functions, licensing obligations, and facility contracts.
Treasury’s proposal addresses the operational model of ‘multi-function platforms that hold assets for customers’ (digital asset platforms), which are identified as common conduits for consumer-related issues. These include the dominant players in the digital asset market in terms of transaction volume and customer numbers, as well as brokers and intermediaries engaged in ‘asset-backed token’ arrangement.
For a more detailed analysis please read our article titled “A digital safety-net”.
For advice businesses, particularly those dealing with clients’ cryptocurrency or other digital assets, this change could bring a level of reassurance that is necessary before digital assets become mainstream financial products.