Australia Moves to Regulate Crypto Exchanges

Australia has unveiled draft crypto laws requiring licenses for exchanges, strict penalties for violations, and new rules to safeguard users.

Draft law and government goals

The Australian government has released draft legislation extending financial services rules to crypto exchanges. The proposal positions digital asset platforms under the same regulatory regime as traditional finance businesses.

Assistant Treasurer Daniel Mulino described the bill as “the cornerstone of our digital asset roadmap.” He stressed that this is a preliminary version open for consultation with industry stakeholders.

New financial products and licensing rules

The draft creates two new financial products: a “digital asset platform” and a “tokenized custody platform.” Both will require an Australian Financial Services License, bringing exchanges under the oversight of the Australian Securities and Investments Commission (ASIC).

Specific provisions also cover wrapped tokens, public token infrastructure, and staking. Exchanges will face tailored obligations, including standards for safekeeping and transaction settlement.

Penalties and exemptions

Breaches of the law could incur fines of up to AUD 16.5 million or 10% of annual turnover. However, “small, low-risk” platforms holding less than AUD 5,000 per client and handling under AUD 10 million per year will be exempt.

Mulino emphasized that the reforms aim to “legitimize good actors and shut out the bad,” giving businesses clarity and consumers confidence.

Industry response

Major exchanges welcomed the bill. Swyftx said licensing was expected, while OKX stressed that enforcement must protect responsible operators from unfair competition.

Crypto.com called the move “long overdue,” and Kraken said it will bring investors greater certainty, though cautioned against a one-size-fits-all model that could hinder innovation.

The Treasury has opened consultation until October 24, after which the law will move toward finalization.