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Australia has shown enormous support for cryptocurrencies and blockchain technology. Despite the illegal activities encompassing cryptocurrencies that consistently drive others skeptical of the legitimacy of it, Australia seems firm on its decision to regulate cryptocurrencies for the better.
According to a recent report from CGTN, a Chinese international English-language news channel, the Australian government is well aware of the rising demands of cryptocurrencies. It noted that over one million Australians have so far invested in cryptocurrencies, which equals four percent of their total population.
Currently, the primary fear of the Australian authorities regarding cryptocurrencies is its illicit use to evade taxes by moving funds to countries with lenient anti-money laundering laws. Cryptocurrency crimes have crept far into the Australian finance sector and, according to a report Australian Taxation Authorities are looking into an Australian international bank’s records for alleged inclusion in money laundering activities for its “crypto clients.”
Adrian Lee, senior lecturer at the University of Technology, Sydney, clarified that there are no such plans to ban cryptocurrencies in Australia as there lies innovation in the technology. However, the government is looking forward to formulating a strict law to ensure every citizen holding cryptocurrencies pay their taxes on the profit earned through it.
Fiat currencies have been around for a long time and have highly strict regulations to guide their usage. Despite that, fiat is vastly used for laundering and other illicit businesses.
Cryptocurrencies, on the other hand, have been around for just over 10 years now. The crypto space is quite nascent and needs to mature before anything can be written in stone about it.
Putting these two in contrast, it seems unreasonable for a government to ban cryptocurrencies on grounds of the number of frauds being carried out using it. No doubt their anonymity makes it quite a task to track illicit transactions, but there can always be a better option to tackle regulation issues head-on, as is the case in Australia, rather than banning cryptocurrencies altogether.
Instability of crypto prices is another reason why governments fear allowing the digital economy into its financial system. For that matter, it must not be forgotten that fiat currencies, throughout their many years of existence, have consistently lost value. On top of that, we have seen several severe economic crises over the past few years.
Similar to the Australian government, it would be for the benefit of everyone if all governments start to recognize cryptos as an innovative technology while also trying to regulate them for its maximized legal use. With other economic crises just around the corner, as many have predicted so far, they might as well consider how cryptocurrencies would solve the problems that face today’s centralized economic system.
What do you think of your government’s stance on cryptocurrencies? Do you think cryptos will ever take over fiat currencies? Drop in your thoughts in the comments section.
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