In a statement on Monday, the Albany government announced the world’s first “token mapping” project to begin this year with the aim of “improving” the way Australia’s regulatory system manages crypto-assets.

Token Mapping will seek to determine the characteristics of all digital tokens available in Australia, providing the government with important knowledge to address new crypto regulation.

“This has not been done anywhere else in the world, so it will make Australia a leader in this work,” Financial Services Minister Stephen Jones and Assistant Minister for Competition, Charities and the Treasury Andrew Lee said in a joint statement.

The government's ultimate goal is to ensure that "customers engaged in crypto are adequately informed and protected," but in a way that incorporates new and innovative technologies.

“The previous government was concerned with regulating crypto-assets but prematurely jumped straight to options without first understanding what was being regulated. The government of Albania is taking a more serious approach to understand what's in the ecosystem and what risks need to be addressed first," the two said.

The token mapping project, Mr. Jones and Mr. Lee explained, should identify notable gaps in the regulatory framework, advance work on a licensing framework, review innovative organizational structures, address custodial obligations for third-party custodians of crypto-assets and provide additional user safeguards.

"A public consultation document on 'token mapping' will be published soon," the pair confirmed.

The Australian Taxation Office estimates that more than one million taxpayers have interacted with the crypto-asset ecosystem since 2018. this way.

The government's crypto move was welcomed by BTC Markets.

Just minutes after the government's announcement, chief executive Caroline Bowler said in a statement: "This move recognizes the importance of digital asset infrastructure to Australia's future and we look forward to working together with the Treasury to create a regulatory framework." "

Back in March, the Liberal government released a Treasury consultation paper acknowledging that regulation should be risk-focused and remain technology neutral. And on Monday, BTC Markets reiterated the position taken by that document, calling for a "proportionate, appropriate regulator of our sector."

"In the Treasury's March 2022 consultation paper. there is talk of risk regulation. He recognizes that cryptoassets are different in nature compared to traditional financial products. Trust issues and information asymmetry can be mitigated using blockchain technology.

“As a result, all regulations must be applied on a risk basis and considered technology neutral in design. Token mapping is the foundational work to achieve this risk-based goal,” Ms Bowler said.

"Stable and appropriate" regulation is needed

A recent study published by ASIC detailing the growing popularity of crypto revealed that among the 1,000 retail investors surveyed, around 44 percent held crypto.

Speaking to InvestorDaily earlier this month, Dr Angel Zhong, senior lecturer in finance at RMIT University's School of Economics, Finance and Marketing, said the study demonstrated the need for "robust and appropriate" regulation.

"The large influx of inexperienced investors and continued regulatory uncertainty highlights the importance of having a stable and appropriate regulatory environment for crypto and digital currency in Australia," she said.

"This is critical to protecting the financial well-being of Australian retail investors, particularly the young and emerging groups." Young investors also often use social media platforms to obtain investment information,” Dr. Zhong added.

Meanwhile, the Financial Planning Association of Australia (FPA) confirmed last month that it had backed a regulatory framework for cryptoassets in a submission to the Treasury, on the basis that it was consistent with their non-crypto equivalents.

FPA head of policy Ben Marchand said the technology underlying an asset was irrelevant when considering the regulation of a financial product.

“Until now, investment in crypto-assets has been so tied to the asset itself, such as Ether [ETH] coin or irreplaceable token [NFT]as a bet on the sustainability of the technology platform supporting the asset, for example the Ethereum blockchain,” he said.

"Providing consistency will reduce confusion for Australian investors and financial service providers."

Maja Garatsa Djurdjevic

Maya's career in journalism spans more than a decade in finance, business and politics. Now an experienced editor and reporter in all elements of the financial services sector, before joining Momentum Media, Maya reported for several established news outlets in South East Europe, looking at key processes in post-conflict societies.