• The Australian government has approved six world-leading crypto reforms

  • “What is clear is that if we embrace these developments, Australia has a tremendous opportunity to capitalize on the convergence of finance and technology,” said Treasurer Josh Frydenberg.

    As part of a new “payments and crypto reform plan,” the Australian government is seriously considering the implementation of a central bank digital currency (CBDC) and has backed numerous forward-thinking regulatory crypto proposals.

    The reforms, according to Treasurer Josh Frydenberg, “will firmly place Australia among a handful of leading countries in the world.”

    The reform plan is said to be the biggest shake-up of the Australian payments system since the 1990s, with the innovative proposals put forward by an Australian Senate Committee in September laying the groundwork for the crypto-related groundwork.

    According to the Australian Financial Review, the government supports six of the Senate Committee’s proposed reforms, including a licensing regime for cryptocurrency exchanges, laws governing decentralized autonomous organizations, and a common access regime for new payment platforms.

    Two proposals relating to tax and financial compliance have been referred to their respective government bodies for consideration, while another proposal relating to renewable energy Bitcoin (BTC) mining tax breaks has been rejected.

    In a speech to the Australia–Israel Chamber of Commerce on Wednesday, Frydenberg outlined the government’s plans for crypto regulation, taxation, and CBDCs (AICC).

    “What is clear is that if we embrace these developments, Australia will have a tremendous opportunity to capitalize on the convergence of finance and technology,” he said.

    Concerning CBDCs, an unnamed senior government source told The Australian on Tuesday that a retail scale “RBA [Reserve Bank of Australia] backed Bitcoin or cryptocurrency” is under consideration and will be a key component of the government’s regulatory reform on digital payments.

    During his AICC speech, Frydenberg was upbeat about crypto asset reform:

    “These reforms will address the ambiguity that can exist regarding the regulatory and tax treatment of crypto assets and new payment methods for businesses.” As a result, it will generate even more consumer interest, facilitate even more new entrants, and enable even more innovation.”

    “These changes will establish a regulatory framework to underpin their growing use of crypto assets and clarify the treatment of new payment methods for consumers,” he added.

    The government appears set to ignore one Senate committee proposal: a 10% tax break for Bitcoin miners who use renewable energy. Swyftx’s Michael Harris, head of corporate development, said:

    “We believe this was a political decision.” The reality is that, no matter how noble the intention, it will be difficult for any government to separate an industry like BTC mining from other energy consumers.”

    However, Harris stated that the “noises coming out of government at the moment are promising,” as the government appears to have recognized the need to implement consumer protection laws while not stifling innovation.

    “However, the devil will be in the details, and we are especially keen to avoid a system that limits customer choice by stacking the deck in favor of large, traditional financial players.”

    Senator Andrew Bragg, the driving force behind the recent crypto proposals, said in a statement that Frydenberg’s crypto and fintech reform plan will put “Australia on the tech map”:

    “Under the Treasurer’s plan, Australia will be a world-leading crypto hub.” New consumer protection rules will also benefit Australian consumers.” “The rest of the world is watching Australia, which is now setting the global standard for crypto, payments, and digital wallet reform,” he said.

    Caroline Bowler, CEO of local crypto exchange BTC Markets, praised the reforms as a “major step forward to upgrade Australia’s one-size-fits-all regulatory framework in real-time.”

    “It’s encouraging to see that the gaps in Australian regulation relating to digital financial products and the exchanges that support them are finally being addressed at the highest level of authority, and the Coalition Government is not shying away from the big issues surrounding crypto, payments, and de-banking,” she said.

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