The Australian Treasury is likely to delay implementing new cryptocurrency rules until mid-2024 or even 2025.
Local governments are expected to implement the rules by the end of 2022. Some expect authorities to rush to do so this year, especially after multiple closures and investor losses that have ravaged the industry recently. Documents released under the Freedom of Information Act reveal that the Australian government will take its time to develop a comprehensive regulatory framework for the local cryptocurrency industry. The governing body will consider the matter in the second and third quarters of this year and could introduce legislation in 2024 or even 2025.
While some consumers believe an unrestricted environment could cause more problems, the Treasury believes there is no need to rush into buying as recent industry disasters such as the collapse of FTX have led to investor exodus. Officials further insisted that rising interest rates a policy launched by many central banks in response to skyrocketing inflation had driven investors away from risky assets, including cryptocurrencies.
Subsequently, the statement informed that the Ministry of Finance has established a special “Cryptocurrency Policy Unit” within the department, whose main objective is to ensure maximum consumer protection. The department intends to propose a ban on cryptocurrency advertisements to protect individuals from fraudulent schemes.
Keeping this in mind, it wouldn't be surprising if Australia announced some of its strictest regulations when the time came. Contrary to Treasury’s assumption that interest in cryptocurrencies has recently faded, a Finder study last October showed that 23% of Australians had some exposure to the asset class. Recall that this number is 17% in 2021 (when Bitcoin and most altcoins hit new all-time highs).
One factor that could boost enthusiasm could be Australia's macroeconomic conditions. Its inflation rate is at 7.3% by the end of 2022 (a 32-year high), and the figure for the first month of 2023 is even more worrisome: 7.4%.
Increased interest in cryptocurrencies in Australia is nothing new amidst the financial crisis. Residents of Argentina, Turkey, Lebanon and many other countries have recently sought alternative monetary instruments due to serious political or economic problems.
A survey by Independent Reserve in late November estimated that even after the infamous FTX crash, the number of HODLers in Australia remained at more than 25%, hurting many domestic investors. Nearly 91% of participants said they were aware of Bitcoin’s existence, and 43% admitted to having some knowledge of Ethereum.
