Australia Unveils New Digital currency Framework and Commits to Addressing Debanking

The Labor-led government of Australia has introduced a novel regulatory framework designed to incorporate cryptocurrency exchanges and associated services within the existing financial service laws of the nation.

The news was made by the Treasury Department on 21 March 2025, marking a critical advancement in formalizing the regulation of the digital asset sector ahead of a potentially competitive federal election slated for 17 May 2025.

According to the proposed plan, crypto exchanges, custodians, and certain brokerage firms engaged in digital asset transactions will need to secure an Australian Financial Services Licence. They will also be obligated to adhere to capital adequacy standards and rules for the safety of customer assets, thereby mirroring the requirements for traditional financial entities.

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Australia’s Crypto Regulations Build on 2022 Consultations for Customized Oversight

This initiative originates from a series of discussions initiated by the government in August 2022, aimed at developing a customized regulatory landscape for digital assets.

Nonetheless, the framework will not be universally applicable. Smaller platforms that fall beneath specific size benchmarks, as well as blockchain developers and token issuers whose assets are not classified as financial products, will be exempt.

The drafted regulations also encompass stablecoins. Those utilized for transactions will be categorized under the government’s Payments Licensing Reforms as stored-value facilities; however, other forms—such as certain stablecoins and wrapped tokens—will not be treated in the same manner.

The Treasury has clarified that trading in exempt tokens on secondary markets will not designate platforms as regulated marketplaces.

Australia outlines crypto compliance plan, promises action on debanking

Australia’s government, led by its center-left Labor Party, has unveiled a new regulatory framework for exchanges under current financial service laws and has committed to addressing the matter of debanking.

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— MetaEra (@MetaEraHK) March 21, 2025

In a wider effort to tackle issues within the industry, Prime Minister Anthony Albanese’s administration has also pledged to work alongside Australia’s four major banks to examine the extent and consequences of debanking, a phenomenon where businesses linked to crypto are denied access to banking services.

Looking forward, the government envisions launching an Enhanced Regulatory Sandbox in 2025 to enable startups to trial new financial offerings without obtaining full licensing. An evaluation of a central bank cryptocurrency (CBDC) is also on the agenda.

While the Labor government intends to initiate public consultation on the proposed legislation, the impending federal election could realign priorities. The opposition Coalition, under Peter Dutton’s leadership, has also vowed to give precedence to crypto compliance should they assume power.

A recent YouGov poll indicated that the two parties are in a closely contested race, leaving the future of crypto crypto law potentially uncertain.

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AFP Initiates Global Investigation as Binance Impersonation Scams Afflict Australian Crypto Investors

Investors in crypto asset within Australia are experiencing escalating financial harms due to a rise in elaborate scams, many involving fraudsters pretending to be representatives of Binance, one of the largest cryptocurrency exchanges globally.

On 20 March 2025, the Australian Federal Police (AFP) announced that it has launched an international inquiry into these fraudulent activities, which are becoming more challenging to identify.

According to the AFP, scammers have been reaching out to victims via SMS, falsely claiming to be affiliated with Binance. The messages often induce a false sense of urgency, alerting recipients about alleged unauthorized access to their cryptocurrency accounts.

These deceitful messages typically include bogus verification codes and a fabricated base level phone number. When victims call this number, they are told to transfer their funds to a so-called “trust wallet” for safekeeping.

In truth, the crypto wallet is controlled by the scammers, and once the transfer occurs, victims are cut off from their assets.

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