Major players like Coinbase and CloudTech Group have welcomed the reform.
Australia’s newly proposed crypto regulation could see digital asset platforms hit with fines of up to $16.5 million for companies that fail to comply.
The new regulation would bring crypto exchanges under the Corporations Act by introducing two new financial product categories, digital asset platforms and tokenized custody platforms.
Under the new plan, providers will be required to obtain an Australian financial services licence and demonstrate that they operate “efficiently, honestly and fairly,” according to Bloomberg.
The rules also enforce a ban on misleading conduct and unfair contracts, while mandating stronger transparency for both consumers.
Severe sanctions have also been proposed for non-compliance, as platforms could now face fines of up to $16.5 million or up to 10% of annual turnover.
However, smaller operators will be exempt if they hold less than $5,000 per customer or process under $10 million in transactions annually.
The government said this mirrors exemptions for traditional financial products.
Assistant Treasurer Daniel Mulino said the proposed regime is designed to weed out bad actors while supporting legitimate businesses.
“This is about giving businesses certainty and consumers confidence,” he said.
The exposure draft is open for consultation until 24 October, after which the government will refine the bill.
Assistant Minister for the Digital Economy Andrew Charlton claimed the regulation would aid Australia in becoming “a world leader in digital assets.”
The move has been broadly welcomed by exchanges and blockchain firms.
Coinbase’s Asia-Pacific managing director, John O’Loghlen, called the bill a “meaningful step” that could boost trust and growth.
“Clear, fit-for-purpose regulation will support economic growth, increase choice for consumers, and ensure Australia remains competitive globally,” he said.
Meanwhile, Many Jiang of CloudTech Group described the proposal as a “defining” moment for the sector, which she said has long been “constrained by regulatory uncertainty.”
Jiang argued that mainstream adoption and institutional investment would accelerate under a clearer framework.
