Bitcoin exchanges in Australia will now be regulated under the purview of AUSTRAC, the country’s financial intelligence agency as the government reforms existing anti-money laundering (AML) and counter-terrorism financing (CTF) laws.
In a public statement today, Australia’s Minister for Justice Michael Keenan confirmed that the country’s bitcoin and digital currency exchanges will be regulated for the first time. The move is part of a wider impetus to strengthen the country’s money laundering laws within days of a financial scandal involving the Commonwealth Bank of Australia. The nation’s biggest bank is alleged by the Australian Transactions and Reporting Analysis Centre (AUSTRAC) of breaching its AML and terrorism financing laws.
In announcing the first stage of reforms to bolster the country’s AML and CTF laws with a new bill, Keenan revealed bitcoin exchanges will be now included under the scope of new legislation which will further strengthen AUSTRAC’s investigative and law enforcement powers.
The Bill provides net regulatory relief to industry of $36 million annually, with the digital currency exchange sector being regulated for the first time, while deregulating low-risk industries such as cash-in-transit, which is already subject to state and territory licensing requirements.
As reported previously, AUSTRAC pressed the government to regulate the digital currency industry a year ago in August 2016. With an official response, published in May this year, the Australian government confirmed it is considering ‘appropriate’ AML/CTF regulation whilst ensuring it facilitates growth of the digital currency sector in the country.
‘The Government will also consider guidance from the FinTech Advisory Group as part of broader considerations around the AML/CTF regulation of digital currencies,” an excerpt from the government’s response added.
Australia’s move to regulate cryptocurrencies like bitcoin follows a notably similar effort by Japan earlier this year, one which will ultimately see bitcoin exchanges operate under the supervision of the Financial Services Agency, Japan’s financial regulator, by an October deadline this year. Japan’s regulation also sees bitcoin recognized as a legal method of payment in the country, a move that has seen a number of retailers across the country accepting the cryptocurrency. One executive at a Japanese bitcoin exchange developing point-of-sale bitcoin payment solutions estimates up to 300,000 Japanese stores accepting the cryptocurrency this year.
Elsewhere, the Philippines has also mandated regulations for bitcoin exchanges in the country earlier this year, effectively acknowledging the cryptocurrency as a recognized method of payment.
Featured image from Shutterstock.