Blockchain Australia sent a recommendation proposal to a senate committee, asking for a transition and safe harbor period for crypto providers.
Industry group Blockchain Australia has sent recommendations to the Senate Select Committee on Australia as a Technology and Financial Centre, asking for safe harbor provision for crypto providers. The draft was created by members and industry stakeholders in collaboration with the group. The overall goal of the proposal is to protect clients while also establishing regulation that encourages innovation.
This is the third time Blockchain Australia has made such a submission, and it acknowledges that a long-term regulatory framework will take time. The executive summary ends with CEO Steve Vallas saying,
“ It’s not too late for Australia to seize the unique opportunity presented to us, to become a global leader in blockchain innovation.”
Crypto safe harbor
Of the overarching recommendations, the group focuses on three major areas:
- To implement immediate safe harbor provisions
- To introduce greater regulatory guidance and engagement in the short term
- Pass a long-term fit-for-purpose legislative framework
By safe harbor, Blockchain Australia means to offer crypto-asset providers, like exchanges, some leeway until more clear regulation is introduced. It also recommends a transition period as these providers will have to adapt to the new laws if any.
In terms of greater guidance and engagement, the group offers several suggestions. The first is to establish a cross-industry and regulatory working group to facilitate communication, among the other key recommendations in this regard. It asks for an approach similar to the U.S.’, which is that banking and competition regulators ensure a transparent and communicated risk-weighted approach to provide banking services to the crypto ecosystem.
The last recommendation relates to the legislation itself. Blockchain Australia recommends a comprehensive token mapping exercise, a new licensing regime, and a full review of the market’s license framework.
Pro-blockchain preempting fair regulation
Supporters of the cryptocurrency and blockchain industry have been lobbying governments to introduce regulation. This is because, with more clarity on right and wrong, key players can operate without worry, and investors are protected. They are making the case that the industry can greatly boost the economy and more rapidly usher in a digital economy.
Governments are all but certain to introduce even tighter regulation in the months to come, as authorities prepare full frameworks. Countries like South Korea and Japan are preparing just this, while the U.S. is likely to publish its own by the end of 2021.
All eyes are currently on the U.S., which has been ramping up its examination of the market. Several high-profile government officials have commented on the same, and investor protection appears to be the major cause for concern.
Australia, meanwhile, has been taking its own steps, with the Senate Committee already exploring crypto regulation. Among other things, it has been said that blockchain technology could curb the import of forced labor goods.