Australia will become the first country to pioneer a ‘Token Mapping’ exercise in an attempt to define the various types of digital assets and bring them under a regulatory framework.
The country’s treasury department in a joint statement released yesterday expressed concerns about the crypto advertisements “plastered all over big sporting events,” which inspired its intentions to push ahead with the regulation.
This exercise will outline new rules on digital assets in order to safeguard and educate consumers about extreme market volatility and the possible pitfalls of crypto investments.
“Safeguarding consumers”
Australian Treasurer Dr Jim Chalmers MP said: “As it stands, the crypto sector is largely unregulated, and we need to do some work to get the balance right so we can embrace new and innovative technologies while safeguarding consumers.”
“With the increasingly widespread proliferation of crypto assets — to the extent that crypto advertisements can be seen plastered all over big sporting events — we need to make sure customers engaging with crypto are adequately informed and protected."
The Albanese Government will improve the way Australia's regulatory system manages crypto assets, to keep up with developments and provide greater protections for consumers.https://t.co/CpLMFUkn1I
— Jim Chalmers MP (@JEChalmers) August 21, 2022
Regulatory framework
The Australian Taxation Office estimates that more than one million taxpayers have interacted with the crypto asset ecosystem since 2018.
Therefore, the government is ready to start consultation with stakeholders to develop a framework for the industry and regulators alike.
Chalmers added: “The aim will be to identify notable gaps in the regulatory framework, progress work on a licensing framework, review innovative organisational structures, look at custody obligations for third party custodians of crypto assets and provide additional consumer safeguards.”
The department will release a public consultation paper on token mapping before the exercise comes into effect.
Crypto advertisements in sports
Earlier this year, Crypto.com signed a sponsorship deal with the Australian Football League (AFL) worth $25 million.
Subsequently, Swyftx, a domestic exchange also signed a three-year deal for an undisclosed sum in February.
In both instances, the deals allow for crypto advertisements to appear within sporting arenas and on televisions across the country.