Australia Sets Sights on Global Crypto Leadership Through Tougher New Rules
The Australian government has introduced an extensive set of regulations for digital asset platforms, signaling a significant move to bring crypto exchanges under the same regulatory umbrella as conventional financial services. The draft law, published on September 25, 2025, requires all crypto service providers in Australia to secure an Australian Financial Services Licence (AFSL) as stipulated by the Corporations Act title1 [ 1 ]. This initiative is intended to strengthen consumer protections, combat money laundering, and mitigate systemic risks, while also encouraging sector innovation.
According to the proposed framework, platforms that fail to comply could face hefty sanctions, including fines reaching AUD 16.5 million or 10% of their yearly revenue, whichever amount is higher title1 [ 1 ]. These penalties target violations such as deceptive practices, inequitable contracts, or not conducting business “efficiently, honestly, and fairly” title1 [ 1 ]. Smaller providers—those managing less than AUD 5,000 per client or handling under AUD 10 million in yearly transactions—will be exempt, reflecting similar exclusions for traditional financial products title1 [ 1 ]. Assistant Treasurer Daniel Mulino highlighted that the new rules aim to “legitimise responsible operators and exclude bad actors,” providing certainty for businesses and reassurance for consumers title2 [ 2 ].
The draft law establishes two new categories for financial products: one for trading and custody, and another for asset protection. Platforms in these categories must meet licensing criteria, maintain minimum capital, and adhere to governance standards similar to those of established financial institutions. Oversight will be handled by the Australian Securities and Investments Commission (ASIC), with a particular focus on preventing failures like the FTX collapse in 2022. The legislation also covers stablecoins, granting exemptions to intermediaries distributing tokens such as AUDF, issued by Forte Securities Australia title1 [ 1 ].
The industry has largely welcomed the changes. John O’Loghlen, Asia-Pacific managing director at Coinbase, described the legislation as a “significant advance” for building trust and expansion, while Many Jiang of CloudTech Group called it a “landmark” for the industry title1 [ 1 ]. Both Kraken and Swyftx commended the regulations for promoting fair competition and enhancing investor trust. Nonetheless, there are ongoing worries that compliance expenses could hinder smaller startups.
On the international stage, Australia’s regulatory direction is consistent with measures adopted in regions such as the EU (MiCA), the UK, and Singapore, all of which have introduced comparable oversight. Andrew Charlton, Assistant Minister for the Digital Economy, stated that the reforms are designed to establish Australia as a “global leader in digital assets,” capitalizing on its position in the Asia-Pacific title1 [ 1 ]. The government is also considering broader exemptions for stablecoin intermediaries, including AUDF, to stimulate innovation while upholding regulatory safeguards title1 [ 1 ].
The public can submit feedback on the draft law until October 24, 2025, after which the government will make further revisions title1 [ 1 ]. The finalized legislation is anticipated in 2026, though enforcement dates are yet to be determined. The Treasury has stressed the importance of a balanced approach, aiming to encourage innovation without jeopardizing financial stability.
These proposed regulations are part of a wider international movement toward tighter crypto regulation, spurred by incidents like the FTX collapse and increasing worries about fraud and systemic threats. By integrating crypto platforms into existing financial regulations, Australia seeks to offer greater clarity for investors while maintaining its edge in the digital asset market.
