Proposed Digital Asset Regulations in Australia
Commentary on the new amendment to the Corporations Act which would include Digital Assets within traditional finance regulatory framework.
Corporations Amendment (Digital Assets) Bill 2025 (Cth)
Read our previous post on LinkedIn.
The application of existing Australian financial services regulation to digital assets, including digital tokens, has been the subject of sustained debate within both the digital asset sector and the legal community. The Corporations Amendment (Digital Assets) Bill 2025 (Bill or Proposed Regulation) seeks to respond to these differing interpretations by adopting a regulatory approach that does not turn on the characterisation of a digital asset or token as a financial product. Instead, the Bill proposes the explicit regulation of newly defined Digital Asset Platforms (DAPs) and Token Custody Platforms (TCPs) by designating them as financial services.
The Proposed Regulation aims to enhance consumer protection, particularly in light of risks that have been highlighted by significant market failures, including high-profile collapses such as FTX. Rather than introducing a bespoke regulatory regime for digital assets, the Bill leverages established financial services regulatory structures. By expanding the scope of regulated financial products to encompass DAPs and TCPs, the Proposed Regulation reflects the principle of “same activity, same risk, same regulation” , thereby creating a degree of familiarity for both market participants and regulators.
If enacted, the Proposed Regulation provides for a six-month transitional period during which the responsible person may apply for an Australian Financial Services Licence (AFSL), or seek to vary the conditions of an existing AFSL, to authorise the provision of DAP or TCP services. The AFSL holder will be required to comply with prescribed obligations, including requirements relating to platform rules, voting arrangements, and the preparation and maintenance of a DAP/TCP disclosure guide.
Stirling & Rose advises on AFSL applications, licence variations, and ongoing regulatory compliance, and can assist organisations in preparing for and responding to the proposed digital asset regulatory framework.