The Government has released a Statement outlining the Government’s approach to extending existing financial services laws to key digital asset platforms. Background.

The Statement says that the four primary elements of Australia’s approach to digital asset reforms are:

• a framework for Digital Asset Platforms (DAPs), which are online platforms that hold digital assets,
  such as crypto, for consumers;
• a framework for payment stablecoins, which will be treated as a type of Stored-Value Facility (SVF)
  under the Government’s Payments Licensing Reforms;
• undertaking a review of Australia’s Enhanced Regulatory Sandbox; and
• a suite of initiatives to investigate ways to safely unlock the potential benefits of digital asset
  technology across financial markets and the broader Australian economy.

The Government says that the legislative framework will focus on the operators of DAPs. The new DAP regime will “not impose a new regulatory burden on digital asset issuers themselves, or on businesses that create or use digital assets for non-financial purposes. The aim is to mitigate key risks for consumers so the sector can safely and securely innovate and grow.”

The DAP regime will apply to:

• DAPs providing common digital products, where there is an underlying custody arrangement.
  These include trading platforms, custody products and some brokerage arrangements.
• Businesses, including foreign entities, providing specified services, such as operating and dealing in
  DAPs and issuing and redeeming tokenised SVFs. Providing advice on using DAPs will be included.

In parallel, the Government is working on a comprehensive framework for payments service providers
(PSPs).2 The Payments Licensing reforms will revise the existing licensing regime for non-cash payment
facilities and ensure it appropriately covers the wide range of payment products and services now
provided in Australia. These reforms will cover the holding of monetary value for making payments –
whether in traditional account-based SVFs or in payment stablecoins. As payment stablecoins are
functionally similar to other SVFs, they will be subject to substantially the same requirements as SVFs.

ASIC is currently considering stakeholder feedback on its proposed updates to Information Sheet 225
(INFO 225).

The government plans to consult on the draft legislation in 2025.

The Government has also released the Board of Taxation’s Review of the tax treatment of digital assets and transactions in Australia.

The report concludes that the taxation of digital assets and transactions can already be accommodated under existing tax law and any uncertainty can be effectively managed by the Australian Taxation Office (ATO) providing additional guidance materials.

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Author: David Jacobson
Principal, Bright Corporate Law
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About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.