Australian Corporate Regulator ASIC Takes a New Approach to Crypto Sector
The Australian Securities and Investments Commission (ASIC) has released a new action plan to monitor the progress of cryptocurrencies and related products such as Initial Coin Offering (ICOs) to effectively mitigate the risks associated with the market.
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Monitoring ICOs and Cryptocurrencies
Today, Australia’s corporate regulator released its corporate plan for 2018-2019, according to which certain domains of the realm of finance need additional monitoring, including the growing cryptocurrency market.
ASIC regards cryptocurrencies and ICOs as potentially harmful to consumers if left uregulated.
The ASIC corporate plan reads:
“We will continue to focus on monitoring threats of harm from emerging products (e.g. ICOs and crypto currencies), cyber resilience, the adequate management of technological solutions by firms and markets, and misconduct that is facilitated by or through digital and/or cyber-based mechanisms.”
Recently, a report from the national consumer watchdog, the Australian Competition & Consumer Commission (ACCC), indicated that cryptocurrency fraud is rising fast. Earlier this year, the ACCC’s annual scam report indicated that Australians have lost over $2.1 AUD million to crypto related scams.
Crypto Firms to Face Onsite Supervisor
The Australian government has, for the most part, struck the right balance when it came to regulating the cryptoverse. Similarly, as per the new proposed action plan, the corporate regulator will put in place “principles for regulating market infrastructure providers to crypto exchanges.”
Meanwhile, since April this year, domestic crypto trading venues have been policed by the country’s financial intelligence agency, Australian Transactions and Reporting Analysis Centre (AUSTRAC), with the aim of countering money laundering and the financing of terrorism.
Additionally, ASIC will escalate the scrutiny of ICOs to identify any misleading or deceptive conduct in a bid to foster investor interest.
To better regulate the crypto sector, the ASIC plan also emphasizes the need for cross-agency collaboration efforts. As part of the new approach, an ASIC onsite supervisor could be placed in major financial institutions, including cryptocurrency firms, as the “focus area” to be monitored.
A New Approach For the Australian Regulator
The ASIC corporate plan outlines its “… new approach for regularly placing ASIC staff onsite in major financial institutions – and in relation to illegal phoenix activity, poor practices in the insurance sector, crypto currencies, corporate governance, older Australians, small business, and foreign financial service providers.”
Although the nature of cryptocurrencies is decentralized, the rise of mainstream adoption has compelled governments around the world to develop a regulatory framework for the sector. Australia has largely positively embraced cryptocurrencies and is a crypto friendly jurisdiction.
Is Australia setting an example of becoming a positively regulated crypto jurisdiction? Share your views in the comments section below.
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