Understanding Australia’s Cryptocurrency Regulations | Designbeep
In all parts of Australia cryptocurrencies and their exchanges are fully legal. In fact, the country has been very forthcoming and progressive in its implementation of the regulations relating to the use of cryptocurrencies. This acceptance of cryptocurrencies has become widespread within private industry in Australia with companies the likes of indusTEC, Flinders University, Subway, Mega Health, plus many more now accepting Bitcoin as a valid form of payment for their products and services.
It was back in 2017 that the government of Australia declared that any and all cryptocurrencies were legal there and that they should be just like property, and so subject to the tax on profit known as Capital Gains Tax (CGT). Prior to that point, cryptocurrencies, such as Bitcoin and Ethereum, had been controversially subject to two different sets of taxes under the Australian Goods and Services Tax (GST). This sea change in the taxation of cryptocurrencies is indicative of the overall progression towards the acceptance of cryptocurrencies by the Australian authorities.
The Exchange Regulations for Cryptocurrency
A set of robust exchange regulations for cryptocurrencies were introduced back in 2018 by the Australian Transaction Reports and Analysis Centre (AUSTRAC). As part of these regulations, any and all exchanges that operate down under must first register with the AUSTRAC and be expected to both identify and verify the identification of their users, maintain in depth records of transactions, and comply with all of the Anti Money Laundering (AML) / Combating the Financing of Terrorism (CFT) obligations in relation to reporting that have been set out by the Australian government. This means that in the future, any exchange that does not register themselves with the AUSTRAC will be subject to a range of criminal charges and may even be penalised financially.
There are a number of these cryptocurrency exchanges down under where you can now learn how to buy crypto in australia.
The Future of Cryptocurrency Regulations
Like many other countries, Australia has established a number of forward thinking cryptocurrency regulations. In addition to the scrutiny that exchanges are now subject to, ICOs too are being equally scrutinized. This comes from Australian Securities and Investments Commission (ASIC) that was founded in 2017 and advises that native token structure (utility or security) directly determines the legal treatment of them under the Corporation Act and general consumer law.
The cryptocurrencies that these regulations are in place to manage include those that are most popular down under and include the likes of Balancer (BAL), DogeCoin (DOGE), The Sandbox (SAND), and Wrapped NXM (WNXM). The native tokens of WNXM can be freely transferred but only members of the Nexus Mutual who are KYC-ed have the ability to both wrap and unwrap NXM. A native NXM token acts as membership to the Nexus Mutual, which is a blockchain that is based mutual and where the purchase of Smart Contract Cover can be made. The value of the currency is directly based on the volume of trades that are made on a global exchange level.
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