Australia has moved to establish a comprehensive legal framework for digital asset platforms, seeking to balance innovation with enhanced consumer protection in a sector previously marked by significant offshore collapses.
The Corporations Amendment (Digital Assets Framework) Bill 2025 was submitted to Parliament on Thursday by the Ministry of Financial Services, aiming to fill a significant regulatory gap. The government seeks to provide clear, enforceable rules for companies handling digital assets on behalf of consumers.
This legislative push comes after major offshore platform collapses, such as FTX and Celsius, left thousands of Australians with billions of dollars in losses and limited legal recourse. The new regulations are intended to prevent similar incidents by integrating the crypto and blockchain sector into the nation’s financial system.
Companies providing digital asset services will be required to obtain an Australian Financial Services (AFS) License, mirroring the licensing standards for traditional financial services but adapted for the unique risks of crypto platforms. This ensures the sector adheres to the same benchmarks for transparency and user integrity.
The Ministry of Financial Services estimates that unlocking digital finance innovation could contribute nearly $16 billion USD annually in productivity and cost savings to the Australian economy. This projection reinforces the government’s view that regulation can spur technological development.
Under the proposed law, licensed platforms must adhere to stringent custody practices, actively protect user funds, and provide transparent information regarding their operations. These measures are designed to curb negligent or abusive conduct that could jeopardize consumer assets.
However, the bill also proposes regulatory exemptions for smaller platforms, specifically those managing less than approximately $3,300 USD per client and facilitating under $6.6 million USD in transactions annually. This exemption aligns with the treatment of other low-risk financial products.
This legislative development places Australia among a growing number of countries working to balance public protection with the promotion of digital innovation. Local industry figures have previously cited the absence of a clear legal framework as an impediment to attracting investment and fostering blockchain solutions within Australia.
The government anticipates that these new rules will foster confidence and stability, encourage the growth of domestic companies, and reduce reliance on overseas services. While some platforms may incur higher compliance costs, officials argue that the long-term benefits will outweigh these challenges.
The bill is now subject to parliamentary debate, and the digital asset sector is closely monitoring its progression. Stakeholders expect the final legislation to maintain a focus on safeguarding consumers without stifling the innovation characteristic of the digital asset market.