Australia's Crypto Industry Faces Uncertainty Amid Regulatory Concerns

According to CoinDesk, Australia's crypto industry is expressing concern following a recent statement by the Australian Securities and Investment Commission (ASIC) that many crypto assets are considered financial products. This classification could impose additional regulatory burdens, potentially prompting companies to relocate to more favorable jurisdictions. The issue came to the forefront during a crypto summit hosted by the Australian Financial Review (AFR), where ASIC's Alan Kirkland addressed the audience. Kirkland's remarks suggested that many widely traded crypto assets would require a license under current laws, raising fears of increased regulatory scrutiny. This has led to apprehensions that the regulator's stringent approach could drive businesses offshore. Amy-Rose Goodey, managing director of the Digital Economy Council of Australia, noted that the industry is feeling uncertain and may explore opportunities abroad. Michael Bacina, a partner at law firm Piper Alderman, emphasized the need for urgent industry consultation with policymakers. He warned that if ASIC continues its regulation by enforcement approach, it could lead to inefficiencies similar to those experienced by the U.S. SEC. ASIC has already taken legal action against crypto companies, including a dismissed case against Finder Wallet. Fred Schebesta, founder of Finder Wallet, criticized Kirkland's approach, likening it to penalizing the Wright Brothers for not having a pilot's license. Schebesta called for updated laws to provide certainty, highlighting the burdensome nature of ongoing compliance post-licensing. Kate Cooper, Australia CEO and head of APAC for Zodia Custody, pointed out that many crypto companies find the current regulatory environment in Australia untenable and are considering relocating to jurisdictions with clearer regulations, such as Dubai and Singapore. Cooper also mentioned that the draft legislation announced in 2023 has yet to be enacted, leaving many gray areas in crypto regulation. Andrew Charlton, a member of parliament, was unable to confirm whether the bill would be introduced before the next federal election, expected next year. ASIC did not respond to CoinDesk's request for comment before publication.