Australian executives deny ‘argument’ for treating crypto as financial product

Australia’s crypto executives have urged caution on lumping all digital assets into the same boat as financial products, following recent comments by Australia’s assistant treasurer.

to speak In the Sydney Morning Herald on January 22, Assistant Treasurer and Financial Services Minister Stephen Jones was commenting on the state of crypto regulation in the country.

He confirmed that the government is on track with its “token mapping” exercise this year to determine which crypto assets to regulate, with a consultation process with the industry “starting soon,” according to a crypto exchange executive. with being”.

However, Jones said he was “not that interested” in setting entirely new rules and regulations for something that he believes is, at its core, a financial product.

Stephen Jones MP Assistant Treasurer and Minister for Financial Services. Source: Australian Labor Party website

“I don’t want to prejudge the outcome of the consultation process that we’re about to embark on. But I start from the position that if it looks like a duck, walks like a duck, and is a duck If it sounds the same, it should be treated the same,” Jones said.

“Other coins or other tokens are being used primarily as a store of value for investment and speculation. [There is a] There is a good argument that they should be treated like financial products.

Australian Securities and Investments Commission (ASIC) and one of Australia’s “Big 4” banks, Commonwealth Bank According to SMH, there are also reportedly in support of regulating crypto as a financial product.

Crypto execs warn of ‘broad’ approach

However, crypto market participants have urged caution over a broad-stroke approach to crypto assets.

Speaking to Cointelegraph, Michael Beccina, a blockchain and digital asset attorney and partner at Piper Alderman, warned that “classifying the technology as a financial product without a clear and workable path to licensing and compliance is The broader approach will likely send more crypto businesses offshore. And create more risk.”

Adam Percy, Swyftx General Counsel, echoed this sentiment in a statement to Cointelegraph:

“The trick is to protect consumers without regulating well-run domestic digital asset businesses and without forcing people to use offshore exchanges under less stringent checks and balances.”

Meanwhile, Holger Arens, CEO of crypto-on-ramp provider Banksa, expressed concerns that over-regulation could “seriously affect” the important role Australia is playing in crypto.

Caroline Bowler, CEO of Australian crypto exchange BTCMarkets, also warned against an “overly prescriptive approach” to regulation.

“This could put our digital economy on the back foot and, over time, hurt our international competitiveness.”

Australian financial regulators have yet to formally lay out their regulatory framework, but in light of the FTX debacle in November, Australian politicians and their global counterparts have seen a greater urgency for action.

Jones said the demise of FTX “puts beyond doubt” the need for crypto regulation.

Related: Australia’s new government finally signals its crypto regulation stance.

In September, Australian crypto-entrepreneur and investor Fred Schebesta warned that token mapping might be rushed. is a cause of concern for the industry..

He added that the complexities of token mapping are unclear and that Australia’s “newly nascent” crypto industry “needs to align with other major markets and their regulations.”

Crypto lobby group Blockchain Australia argued at the time that if all crypto-assets were treated as financial products, it would hurt the crypto sector’s investment, innovation, and consequently the industry. Jobs will disappear.