March 21, 2025 – The Australian government, led by Prime Minister Anthony Albanese’s Labor Party, has introduced a new crypto regulation framework that will impose stricter oversight on cryptocurrency exchanges, custody providers, and brokerage firms. The move comes ahead of the highly anticipated 2025 federal election, where both major parties have pledged to prioritize crypto regulation if elected.
New Compliance Requirements for Crypto Firms
Under the proposed framework, cryptocurrency exchanges and custody services must comply with existing financial service laws. Key requirements include:
Obtaining an Australian Financial Services Licence (AFSL) Meeting minimum capital requirements to ensure financial stability Safeguarding customer assets similar to traditional finance institutions
This aligns crypto exchanges with regulated financial entities, increasing accountability and consumer protection.
Who Is Exempt From the New Regulations?
Not all crypto-related businesses will be affected by these changes. The following are exempt:
Small crypto platforms that do not meet certain size thresholds Blockchain software firms Companies dealing in non-financial digital assets Some stablecoins and wrapped tokens, though payment stablecoins will be classified as stored-value facilities
Government’s Broader Crypto Strategy
The Albanese administration has also pledged to tackle the debanking issue, working closely with Australia’s “Big Four” banks. Additionally, the government plans to:
- Conduct a review of a central bank digital currency (CBDC)
- Launch an Enhanced Regulatory Sandbox in 2025 to allow businesses to test financial innovations without needing a full license
These initiatives reflect a proactive approach to regulating digital assets while fostering innovation in Australia’s growing crypto industry.
Industry Response: Calls for More Clarity
The crypto industry has largely welcomed the new regulations but has raised concerns about certain details.
Caroline Bowler, CEO of BTC Markets, stated that while the reforms make sense, clearer guidelines on capital adequacy and custody requirements are needed. Kraken Australia’s Jonathon Miller urged the government to introduce stronger crypto legislation to eliminate uncertainty and support industry growth.
Australia’s Expanding Crypto Market
Australia is rapidly becoming a major player in the global crypto landscape. The country now ranks third in the world for Bitcoin ATMs, with over 1,453 machines—a massive jump from just 67 in August 2022.
Meanwhile, financial regulators continue to tighten oversight:
In February, AUSTRAC proposed stricter anti-money laundering (AML) and counter-terrorism financing (CTF) rules to curb financial crime. In December, ASIC released a consultation paper that could classify many digital assets as financial products, requiring firms to obtain financial licenses.
What Happens Next?
The draft legislation will soon be open for public consultation, but the outcome could depend on the 2025 federal election results. While Labor is leading the charge, the opposition Coalition has also vowed to introduce its own crypto regulatory framework if it wins.
This means that Australia’s crypto regulations could evolve significantly in the coming months, shaping the future of the nation’s digital asset economy.
