report<\/a>. Platforms would be required to hold an Australian Financial Services License and comply with conduct standards, including acting \u201chonestly and fairly\u201d and avoiding deceptive practices.<\/p>\nFirms that fail to comply could face penalties equal to the greater of A$16.5 million ($10.9 million), three times the benefit obtained, or 10% of annual turnover. Smaller operators would be exempt if they hold less than A$5,000 per customer and process under A$10 million in annual transactions.<\/p>\n
Scope of the proposed rules<\/h2>\n
The draft legislation marks one of the government\u2019s most significant steps in regulating the country\u2019s crypto sector, which already includes global players such as Coinbase and Kraken. Industry consultation is open until Oct. 24, with final legislation expected later in 2025, followed by a 12-month transition period.<\/p>\n
<\/p>\n
The rules extend consumer protections to \u201cdigital asset facilities\u201d such as custody services and multilateral trading platforms, while excluding decentralized tokens not managed by intermediaries. <\/p>\n
Treasury said the framework would align with international standards, referencing the EU\u2019s MiCA and Singapore\u2019s Payment Services Act. It also incorporates the OECD\u2019s Crypto-Asset Reporting Framework for tax transparency.<\/p>\n
Key requirements include segregating client assets, maintaining cybersecurity safeguards, clear risk disclosures, and internal dispute resolution processes. The bill also seeks to address \u201cdebanking\u201d by working with major Australian banks to ensure crypto businesses retain access to financial services.<\/p>\n
Industry reaction and next steps<\/h2>\n
Industry response has been cautiously positive. Coinbase\u2019s Australia head John O\u2019Loghlen welcomed the proposals, saying clear regulation would support growth and global competitiveness. Kraken\u2019s local general manager Jonathon Miller said the draft followed an \u201cextensive consultation period\u201d with government and industry.<\/p>\n
The proposal builds on the government\u2019s March 2025 roadmap for digital assets, which prioritized licensing, custody standards, and stablecoin regulation. If passed, it would establish one of the most comprehensive oversight regimes in the Asia-Pacific region.<\/p>\n
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