Australia launches an exchange registration system for Bitcoin, and the era of legal trading is approaching
Recently, the Australian Senate officially approved the 2017 Anti Money Laundering and Counter Terrorist Financing Amendment, authorizing the country's financial intelligence agency, the Australian Transaction Reporting and Analysis Centre (AUSTRAC), to regulate the Bitcoin exchange.
This is another latest measure in digital currency regulation by the Australian government after announcing the cancellation of double taxation on Bitcoin this summer. While strengthening efforts to combat illegal activities such as money laundering and terrorist financing, it also further consolidates the competitiveness of Australia's blockchain and digital currency industries globally.
According to the bill, Bitcoin exchanges in Australia are required to register with Australia and leave a record on the Digital Currency Exchange Register. The registration system will be launched within 6 months after the bill takes effect. In addition, the exchange also needs to develop a series of risk prevention measures, including finding anti money laundering and counter-terrorism financing solutions, verifying customer identity information, reporting any suspicious activities, and reporting international transactions or transactions exceeding AUD 10000 to Austrac. The exchange also needs to retain some transaction records and customer identity information for up to 7 years.
If the exchange provides services without registering with Austrac, it will face civil and criminal penalties. Those responsible for violating the 2017 Anti Money Laundering and Counter Terrorist Financing Amendment on cryptocurrency exchanges will receive a minimum sentence of 2 years, plus a fine of AUD 105000, and a maximum sentence of 7 years in prison, an individual fine of AUD 420000, and a company fine of AUD 2.1 million.
The revised Anti Money Laundering and Counter Terrorism Financing Law positions digital currency as a digital representation of value, which can be seen as a medium of exchange or a means of storing value, or as an accounting unit that is not controlled by the issuing authority.
Danielle Szetho, CEO of FinTech Australia, stated that this legislation will grant digital currency exchanges in Australia a "legal identity" to ensure that virtual tokens such as Bitcoin are traded in a regulated environment.
Although many people may believe that the passage of the bill recognizes that Bitcoin Exchange and other existing financial institutions have equal status in Australia, further enhancing the legitimacy of digital currency trading in the country, the bill does not mention measures to enhance exchange trading security. Investors are concerned that this move may force exchanges to shift their focus from providing high-quality services to compliance affairs.
At present, all major digital currency transactions in Australia include BTC Markets, Australia Crypto Exchange, CoinJar, etc. Although the Australian government maintains an open attitude towards Bitcoin, according to Coinmarketcap data, the proportion of Bitcoin transactions settled in Australian dollars is less than 1%, significantly lagging behind the two major markets of South Korea and Japan.
On July 1st, the Australian federal government announced the abolition of the Goods and Services Tax (GST) on Bitcoin and officially recognized Bitcoin as a currency. This means that Bitcoin investors trading Bitcoin on legitimate trading platforms will no longer be taxed. Previously, Bitcoin buyers were required to pay GST twice whether they were buying Bitcoin or using Bitcoin to purchase other goods and services.
In October this year, the Australian Parliament passed a bill declaring the long controversial era of "double taxation" officially over, clearing a major obstacle to the rapid development of the country's fintech industry. The government has successively introduced measures to regulate the digital currency trading market, which is conducive to further expanding Australia's digital currency user base, increasing the trading volume of Bitcoin, and making the country join Japan's "camp" and become a Bitcoin friendly country.
In addition to giving the green light to digital currency transactions, Australia is also actively embracing blockchain technology. Last week, the Australian Stock Exchange (ASX) announced that it will replace the 27 year old Chess system with a blockchain platform to handle stock trading, providing customers with more new services while reducing operating costs. ASX has also become the world's first large-scale exchange to officially adopt blockchain technology. In addition, on the same day, the Federal Bank of Australia announced plans to use blockchain technology to issue bonds, and the project will be launched next year.
The Australian government's intention is simple: to leverage the power of emerging technologies such as digital currency and blockchain to become a new global financial technology center.
