Australian Treasury Proposes Licensing Regime for Crypto Exchanges

The Australian Treasury has released a consultation paper proposing to regulate cryptocurrency exchanges instead of individual tokens, requiring exchanges to obtain a financial services license from the local financial regulator if they hold more than $3.2 million or $946 per individual. The proposed regulatory framework aims to address consumer harms while supporting innovation in the digital asset sector. The proposal has received mixed reactions from crypto exchanges, with some calling it thoughtful and others expressing disappointment at the approach of fitting crypto into existing financial services regulation. The Treasury is seeking feedback on the proposal until December 1, 2023.