As the popularity of cryptocurrency increases, Australia has set a positive example in terms of implementing sustainable, non-restrictive regulations.
Last week saw the Australian Transactions Reports and Analysis Center (AUSTRAC) implement viable new rules regarding cryptocurrency exchanges. The most significant legislation enacted was the requirement of digital currency exchanges to register with AUSTRAC and comply with the government’s anti-money laundering, counter-terrorism financing obligations.
Regulations and licensing
Three exchanges have already been granted a license to operate in Australia: BTC Markets, Independent Reserve, and Blockbid. The remaining trading platforms have until 14 May to comply with AUSTRAC’s regulations.
AUSTRAC CEO Nicole Rose commented that as well as challenging the ramifications of decentralized trading such as money laundering, the new rules would also ”help strengthen public and consumer confidence in the sector”.
The government has also stated that initial coin offerings (ICOs) would be treated depending on the usage of the token, be it security- or utility-based. If the ICO was considered by law to not be offering financial products, it would be regulated under Australia’s Corporations Act.
The Australian Tax Office has also introduced 100-point identification checks to track cryptocurrency investors, who are required to pay tax on their earnings.
Blockchain Silicon Valley
Meanwhile, Australian technology firm IOT Group have partnered with Hunter Energy in recommissioning a disused power station in the hopes of becoming the country’s first pre-grid, cost-effective power alternative for blockchain operators.
The project is being dubbed the ”new Silicon Valley”, with the site planned to offer space to host data centers with direct access to power. This will bypass the energy grid, allowing clients to purchase wholesale electricity tariffs directly from the power station.
While Australia may not be the largest market for Bitcoin and other digital currencies, it is one that is quickly growing. It is currently ranked the 13th in the world for Bitcoin trading volume by currency, with the AUD seeing around BTC 276 trading via the AUD in a 24-hour period. Comparatively, it is not uncommon for Japan to process BTC 301,404 in the same period.
Australia’s attempts to regulate the cryptocurrency industry has so far been successful in its endeavors to both protect citizens and the financial sector, while developing and incorporating the technology within the infrastructure of the country.
Its progressive legislation has the opportunity to economically benefit the country, as well as the cryptocurrency market in general. With mainstream adoption increasing, governments must look for ways to incorporate the decentralized system within the legal framework of countries.