The financial authorities are contemplating beginning discussions with the crypto industry while targeting to implement rules that would regulate the crypto exchanges in the coming year following the crash of FTX.com (one of the largest crypto trading companies across the globe), as per a report published in the Australian Financial Review.
FTX Australia’s Downfall Leads to Its License Cancelation and ASIC’s Declaration for New Regulation
Jim Chalmers (the spokesperson for the Australian Treasurer) remarked on this matter by saying that the developments point out a deficiency in transparency as well as customer protection in the world of crypto assets, compelling the authorities to take strict measures for enhancing regulatory agendas which would still promote innovation.
Caroline Bowler, the CEO of BTC Markets Pty (a crypto exchange based in Australia), stated that she appreciated the exclusive developments. She added that she was enthusiastic to say that the country’s authorities have taken these actions after a long while. Bowler is additionally a member of Blockchain Australia (the chief entity in Australia for the industry).
She is of the view that it is just unlucky that these developments are being witnessed after the collapse of FTX and a huge impact put on the investors living in the country. The funds of up to 30,000 investors from Australia were frozen by the crypto exchange that has now become bankrupt, according to KordaMentha Pty (a native investment advisory company that is representing the Australian consumers of FTX).
The Australian Securities and Investment Commission revoked the license of the Australian subsidiary of FTX – FTX Australia – as the FTX saga began to unfold. Chalmers’ spokesperson mentioned that they are keenly tracking the collapse of FTX, taking into account the volatility in the markets of crypto assets as well as the spillovers dealing with the financial markets.
The managing director of Kraken (a crypto exchange based in the United States), Jonathan Miller, disclosed that he expects the Australian Treasury to offer substantial input in the case of the industry’s regulation. As per him, the supermarket is witnessing a stringent regulatory regime and it has suffocated innovation.
He referred to the jurisdiction of Japan (where the exchange has secured a license to operate) saying that the crypto market is suffering there due to stringent regulation. Miller asserted that the Australian authorities should additionally focus on making adequate legislation while collaborating with the rest of the jurisdictions.
While discussing the situation of entities like FTX in the Bahamas, he asserted that uncertainty in the regulatory agendas of the other regulatory regimes becomes one reason for such incidents. In October last year, the Senate of Australia released a report covering the payment industry and digital assets. In that report, there were discussed 12 recommendations regarding the legislation as well as management of the emerging sector.
New Australian Government Leaves Token-Mapping Procedures
Nevertheless, the government changed in the country in May and just some of the recommendations were picked by the newly coming administration. They did not adopt a token-mapping procedure for the identification as well as the ranking of the crypto assets in line with their use cases and the primary blockchain technology.
Senator Andrew Bragg noted in his report that cryptography and blockchain-related concepts have considerable potential. As Bowler puts it, the blockchain industry of Australia has been majorly self-regulating, with native exchanges mainly avoiding offering high-yield products or lending because of their mounting risk.