The financial industry continues to change and evolve, especially now, with cryptocurrency and blockchain technology seeing an increased rate of adoption by financial institutions and the retail sector alike. With that in mind, the Australian government revealed that it has plans to reform the local financial sector in 2023 and modernize it by embracing new economic opportunities.
The country is aware that there are numerous challenges, some that have been around for a long time, others that are just emerging, and many that will come up as this technology continues to evolve. However, the country is ready to meet these challenges and respond in the best way it can.
The paper describes Australia’s new goals
According to its announcement, Australia plans to achieve several goals. This includes updating and strengthening the local payments system, strengthening the infrastructure of its financial markets, establishing a regulatory framework for BNPL (Buy Now, Pay Later), and creating a framework for regulation and licensing of crypto companies.
The plans were announced last week by the country’s government in a consultation paper meant to help finalize the plan. However, the strategic plan that will explain how is this going to be done and cover other aspects of the upcoming changes will be released in 2023, likely during Q3.
The recently released document is seeking views on different matters, including principles required to support a world-class payments system, as well as priorities that would reflect the payments landscape, which is currently seeing significant changes as part of its ongoing evolution. Finally, the Australian government is also interested in supporting reform initiatives and actions.
The current government has a lot of catching up to do
The country’s Assistant Treasurer and Minister for Financial Services, Stephen Jones, alongside Treasury’s im Chalmers, released a joint statement about the plans, saying that the country’s regulatory architecture did not evolve alongside market changes. Like many other nations, Australia feels that its regulations are too behind the market in its current state in order to accurately address its current issues.
The two officials added that the previous government did little to follow the modern market changes and that this can be said for many other areas, as well. In other cases, it made plans, announcements, and promises, but it didn’t deliver.
Right now, acting Prime Minister Anthony Albanese and his government are taking action to improve regulations for cryptocurrency firms. With the growing rate of adoption, the government is planning its next steps in areas such as token mapping. One of these steps is the creation and release of a consultation paper early next year, which will define which digital assets should be regulated by the country’s financial services laws.
It will also address the development of proper licensing and custody settings for the protection of consumers. After token mapping, the authorities also intend to consult on licensing and custody frameworks before introducing actual legislation.
Lastly, the paper wishes to explore the Australian CBDC policy rationale, including all considerations associated with the central bank digital currency in economic, legal, technological, and regulatory contexts.