Australian lawmakers have given their verdict on Senator Andrew Bragg’s proposed cryptocurrency bill, officially known as The Digital Assets (Market Regulation) Bill 2023. The long-awaited decision from the Senate Committee on Economics Legislation has finally arrived.

Committee Recommends Against Passing the Bill

On September 4th, the Senate Committee released its evaluation of the cryptocurrency bill, and their recommendation is clear: the bill should not be passed. Instead, they advocate for further research on the subject matter.

However, not all senators share this viewpoint. Senators Bragg and Dean Smith have voiced their support for the bill in a dissenting report. They suggest passing it with minor adjustments, one of which is excluding nonfungible tokens (NFTs) from the definition of regulated digital assets.

Key Recommendations

In their report, Bragg and Smith make several key recommendations. They propose excluding specific asset-based tokens, such as the Gold and Silver Standard and the BetaCarbon Token, from the stablecoin definition. Additionally, they suggest extending the transition period from three to nine months.

A image from the report on Andrew Bragg's Cryptocurrency Bill

Tax Treatment and Regulatory Framework

Furthermore, the dissenting senators urge the Board of Taxation to conduct a thorough review of the tax treatment of digital assets and transactions in Australia. They aim to introduce legislation for this in early 2024. They also emphasize the importance of implementing the recommendations of the Council of Financial Regulators to address the issue of debanking in Australia.

Notably, this issue has the potential to drive the cryptocurrency industry underground, which the senators view as undesirable.

A Blow to Digital Asset Regulation and Changing Crypto Landscape

The dissenting report asserts that the government’s current approach to digital asset regulation has negative consequences for Australian consumers and investment. They believe that the bill represents a significant step toward establishing a comprehensive digital asset regulatory framework. Also, that any delay or rejection of it could be detrimental.

Senator Bragg introduced the Digital Assets (Market Regulation) Bill 2023 in March. This was with the goal of protecting consumers and promoting investor confidence. The bill contains recommendations for the regulation of stablecoins, licensing of exchanges, and custody requirements.

Long-Awaited Decision

Furthermore, the Senate Committee’s decision comes after several delays in the reporting process. Originally expected to provide a report by August 2nd, the committee sought extensions, pushing the deadline to August 25th, and finally arriving at the decision on September 4th. This delay has added to the anticipation surrounding the bill’s fate.

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