Australia is set to further grow its world-leading blockchain and digital currency industry following the Australian Parliament’s approval of anti-money laundering legislation, according to Australian fintech leaders.
The Australian Senate passed legislation extending anti-money laundering and counter-terrorism financing regulation to digital currency exchanges on Thursday, December 7th.
The legislation requires these exchanges to monitor and report suspicious and large transactions to the Australian Transaction Reports and Analysis Centre (AUSTRAC).
This follows the Parliament’s approval of legislation on October 18th that recognized cryptocurrencies as equivalent to money and therefore removed (from July 1st, 2017) the potential that the use of cryptocurrencies would be subject to double goods and services taxation.
In fact, some central banks have announced a complete prohibition on the use of digital currencies to make payments. Australia has taken a different approach and supported a regulated digital currency industry.
FlashFX chief enabling officer and FinTech Australia Blockchain Working Group Co-lead Nicolas Steiger said: “To enable further growth of the digital currency industry in Australia, this is a milestone achievement that will allow for an equal regulatory playing field and should only solidify consumer trust in this new industry.”
Sam Lee, the CEO of Blockchain Global said: “As a venture builder in the blockchain industry, we welcome regulatory clarity to uplift the investability of blockchain enabled startups in Australia.”
Paul McKenzie, Operations Manager of digital currency exchange ACX.io said: “ACX.io applaud the Australian Government’s update to the Anti-Money Laundering and Counter-Terrorism Financing Bill, further legitimising cryptocurrencies. This will stamp out fraud and allow innovation to flourish; a bold move that will benefit Australian’s for years to come.”
Leigh Travers, CEO of ICO and blockchain consultancy DigitalX and Deputy Chair of the Australian Digital Commerce Association (ADCA), said: “This is a reform that ADCA has been calling for. We have been delighted to work with the Attorney-General’s Department and AUSTRAC on a sensible regime to provide business certainty and confidence to consumers.”
FinTech Australia CEO Danielle Szetho said the legislation’s approval reaffirmed Australia’s ability to develop sensible and orderly fintech-friendly regulation, which both protected consumers and society and allowed new industries to thrive.
“The Australian Government has worked closely with the nation’s fintech industry over some time in developing and drafting this legislation,” Ms. Szetho said.
“Now it is in place, the legislation will help bring further legitimacy to exchanges operating in Australia, unlocking the benefits of digital currency usage and trading whilst ensuring this is done in an appropriate way.
“Overall, this development is the latest in a series of important steps that will ensure Australia’s Blockchain and digital currency industry remains one of the most highly regarded and vibrant in the world.”
Under the legislation, digital currency exchange providers will be required to:
– Enroll in the Australian Transaction Reports and Analysis Centre (AUSTRAC) and register on the Digital Currency Exchange Register maintained by AUSTRAC
– Adopt and maintain a program to identify, mitigate and manage the money laundering and terrorism financing risks they may face
– Identify and verify the identities of their customers
– Report suspicious matters, international transactions and transactions involving physical currency that exceeds $10,000 or more (or foreign equivalent) to AUSTRAC, and
– Keep certain records related to transactions, customer identification and their program for seven years.