The Australian government’s new regulations come as bitcoin frauds increase 162% to $221 million by 2022.
The Australian government is beefing up its market regulator’s digital asset unit as part of a “multi-stage strategy” to crack down on cryptocurrency and ensure adequate risk disclosures from cryptocurrency businesses.
According to a joint statement issued on February 2 by Australian Treasurer Jim Chalmers and Assistant Treasurer Stephen Jones, the new rules are intended to safeguard consumers dealing with cryptocurrencies.
The treasurers stated that the multi-stage strategy will have three components: more enforcement, improved consumer protection, and the establishment of a framework for token mapping reform.
The size of the Australian Securities and Investments Commission’s (ASIC) digital assets unit will be increased, as will “enforcement measures.”
According to Chalmers and Jones, ASIC will focus on ensuring that customers are adequately informed about the hazards posed by crypto goods and service providers.
Cointelegraph contacted ASIC to inquire about the number of extra roles that would be filled, but did not receive a fast answer.
Meanwhile, the Australian Competition and Consumer Commission (ACCC), the country’s competition watchdog, is due to receive additional capabilities to safeguard consumers against cryptocurrency-related frauds. It stated that fraud losses from cryptocurrency transfers exceeded $221 million in 2022.
The new technology will be a real-time data-sharing platform that the ACCC will employ to identify and prevent cryptocurrency frauds.
When a framework to govern the licencing and custody of digital assets is implemented, it will “ensure customers are safeguarded from avoidable business failures or the exploitation of their assets by service providers.”
This framework, however, will not begin until mid-2023 and will most likely take a long time to be enacted into legislation.
“The previous administration dabbled in crypto policy but never took the time to futureproof our regulatory frameworks to protect consumers and guide this new and emerging class of assets,” the treasurers said, adding, “We are acting swiftly and methodically to ensure that consumers are adequately protected and true innovation can flourish.”
On February 2, the Australian Treasury issued its token mapping consultation document, which aims to establish which aspects of the cryptocurrency ecosystem would be regulated and to what extent.
The multi-stage approach plan was accelerated by FTX’s disastrous collapse in November, which affected over 30,000 Australians and 132 Australian-based businesses.