Australia Tightens Rules for Crypto Exchanges
ASIC is setting stricter requirements for exchanges and custodians, with a focus on customer funds, buffers, and licenses. Australia is following the path of MiCA and other major jurisdictions.
Key Takeaways
- ASIC is proposing stricter rules for crypto exchanges and digital custodians, with requirements for customer funds, transactions, and financial buffers.
- Companies will need to update their license or approval before the new framework takes effect next year.
- Australia points to FTX and Cryptopia as examples of the risks of weak oversight and security.
Australia is taking another step in the regulation of crypto. The ASIC regulator has published proposals for stricter rules for crypto exchanges and digital custodians. The focus is on protecting customer funds, handling transactions, and maintaining financial buffers. Companies covered by the rules will need to update their license or approval before the new framework takes effect next year.
Licenses and Oversight
ASIC opened a consultation on Thursday on the new rules. It runs until November 27, after which the regulator expects to publish the final guidelines and standards in March 2027. The proposals are part of a broader law passed by the Australian parliament in April, which takes effect on April 9, 2027.
Under the new setup, digital asset platforms and tokenized custody platforms must have an Australian Financial Services license from ASIC to operate legally in Australia. That moves crypto closer to the same oversight framework as traditional financial firms.
Lessons From Earlier Shocks
The timing is no coincidence. Australia is explicitly pointing to the collapse of FTX in 2022, when about 30,000 Australian customers lost access to their money. The downfall of Cryptopia in neighboring New Zealand, after a major hack three years earlier, also remains an important example of what can go wrong when oversight and security fall short.
Why This Matters
For European crypto readers, this is especially interesting because Australia is moving in the same direction as the European Union, Singapore, and Hong Kong. Those countries and regions are all building separate frameworks for crypto, with more emphasis on licenses, customer protection, and market integrity. That shows stricter rules for crypto exchanges are becoming more and more the global norm. That trend is also visible in Europe: the UK regulator recently opened a licensing process for crypto companies, with a similar focus on formal approval and oversight.
