As from 3 April 2018, cryptocurrency exchanges throughout Australia must now follow new rules designed to combat money laundering and terrorism financing.
New obligations for exchanges to adhere to are clearly laid out in the Australian Transactions and Reports and Analysis Centre’s (AUSTRAC) new webpage. Digital currency exchange providers registering with Austrac will be required to identify and verify the identities of their customers and report suspicious matters. Transactions involving physical currency or more must also be reported.
Providing digital currency services without registration will be deemed a criminal offence under the new laws. This follows the Anti-Money Laundering and Counter-Terrorism Financing Bill 2017 passed last year by the Australian Senate. It was the second new bill to successfully pass through the Senate concerning cryptocurrency regulation. The first dealt with Australia’s controversial and unpopular double taxation of cryptocurrencies.
The Australian ministry of justice suggests that the new legislation will “close the regulatory gap,… with the authority of AUSTRAC” and ‘”strengthen investigation and execution powers, to expand the search and capture opportunities for police and customs at the border and provide regulatory assistance to the industry”.
Attempts to bring a legislative base to the cryptocurrency market were conducted since the middle of 2016, when the government issued a large-scale statement on financial technologies. Although these new measures give AUSTRAC the power to prosecute non-compliant exchanges they state that a “policy principles” period will be in place from 3 April. During this time, AUSTRAC can only take punitive action if a cryptocurrency exchange fails to comply with the new rules or fails to at least take “reasonable steps” to do so.
2017 was the year of the blockchain for Australian cryptocurrency enthusiasts. In 2018, Australia ‘s private sector continues to explore a range of blockchain applications as the industry continues to grow from state to state. On 12 May, the Sydney Showground has scheduled a Bitcoin and Blockchain Fair which promises a place where the public can learn about “exciting new opportunities in the growing ecosystems of cryptocurrency and blockchain”.