- Australia plans to fine crypto platforms up to 10% of their yearly revenue for breaking new rules.
- Smaller crypto firms may avoid new licensing if they handle low customer funds and low transaction volume.
- Stablecoin distributors get relief from some rules if coins come from licensed financial service providers.
Australia has introduced draft legislation requiring digital asset platforms to hold a financial services licence. According to the proposal that the Treasury has issued, crypto exchanges and custody providers will be subject to the Corporations Act. It also provides a high level of standards of conduct, transparency, and operations.
Platforms that act dishonestly or use unfair contract terms could face severe penalties. These include fines of AUD $16.5 million, three times the benefit gained, or 10% of yearly revenue. The Australian Securities and Investments Commission will oversee licensing under the new framework.
The draft legislation opens for public consultation until October 24. The final version is expected to be submitted to parliament afterward.
AUSTRAC Oversight Grows Amid Retail Risk Concerns
The move follows growing concern among regulators about rising retail investment in digital assets. Australia’s financial crime agency, AUSTRAC, recently ordered Binance’s local unit to undergo an external audit . The review was prompted by concerns around anti-money laundering and terrorism financing.
These new rules are based on the already existing obligations which are presently in force at AUSTRAC. The draft law broadens the compliance expectations and penalties in case of breach. It is in line with continuous scrutiny by the Australian Taxation Office, which tracks crypto transactions as capital gains.
The proposal is part of broader efforts to close regulatory gaps. Regulators have warned that weak standards leave consumers exposed and markets vulnerable to abuse. Earlier this year, AUSTRAC tightened rules on crypto ATMs in Australia , warning operators to follow compliance laws or face penalties.
Exemptions Offered to Smaller Crypto Operators
While the draft rules set high standards, not all operators will be affected equally. Smaller platforms will receive exemptions under certain thresholds. These apply to firms holding less than AUD $5,000 per customer and processing under AUD $10 million annually.
This approach aims to avoid placing a heavy burden on low-volume operators. It also reflects efforts to strike a balance between innovation and regulation. According to reports, around 400 crypto platforms are currently registered with AUSTRAC. However, many of them are inactive or operate at minimal capacity.
Platforms falling below the exemption threshold will not need a full licence. They must still meet anti-money laundering obligations already in place.
ASIC Takes Further Steps on Stablecoin Oversight
In a related move, ASIC granted relief for intermediaries dealing with stablecoins issued by licensed providers. The relief exempts them from separate market and clearing licences until June 2028. It applies only when the coins come from regulated Australian Financial Services Licence holders.
ASIC’s action shows a flexible approach to oversight where controls already exist. The agency has also issued guidance on tokens likely to require licensing. Tokens functioning as financial products remain under current financial laws.
Non-financial digital assets, such as gaming tokens and NFTs for art, will stay outside regulatory scope.
