Australia's Government Calls for Digital Asset Platforms to Abide by Existing Financial Regulations
The Australian government has unveiled a proposal aimed at imposing stricter regulations on cryptocurrency trading platforms, with a focus on enhancing oversight of customer funds.
The proposal, released on Monday, suggests subjecting digital asset platforms to the same laws that govern other financial services providers, according to a report by the Wall Street Journal.
As part of the plan, crypto platform operators will be required to obtain a financial services license, as well as continuous monitoring and routine audits of customer funds.
"Government is acting methodically to ensure that consumers are adequately protected and innovation can flourish," Australian Treasurer Jim Chalmers stated in a released statement.
He also noted that the proposed regulations align with similar measures implemented in other jurisdictions.
The recent collapse of some high-profile crypto firms has underscored the need for tighter oversight.
For one, the collapse of crypto exchange FTX in November 2022 revealed significant vulnerabilities.
At the time of its downfall, FTX held a staggering 218.6 million Australian dollars (US$137.7 million) belonging to 24,656 local customers, as reported by local bankruptcy administrator KordaMentha.
It is worth mentioning that FTX had previously held an Australian Financial Services license, which was subsequently suspended by regulators.
FTX founder Sam Bankman-Fried is currently facing trial in the United States.
Prosecutors allege that Bankman-Fried orchestrated the theft of billions of dollars from customers, using the funds for personal enrichment, venture investments, and even political campaign contributions.
Bankman-Fried has entered a plea of not guilty to all charges.
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