A Senate committee focused on fintech has recommended a complete overhaul of the regulatory process in Australia for the digital currency industry. In a new report, the committee recommended several changes that will impact digital currency exchanges, decentralized finance (DeFi), decentralized autonomous organizations (DAOs), block reward miners, traders and other stakeholders in the budding industry.
The Senate Committee on Australia as a Technology and Financial Centre submitted its third and final report in parliament recently. In the report, it proposes a raft of measures meant to bring the digital currency industry under the purview of the government, including welcoming block reward miners with tax breaks at a time when China is stamping them out.
The committee has been in consultation with several stakeholders in the digital currency industry as it prepared the report, seeking to strike a delicate balance between protecting investors and leaving room for innovation.
From the Bitcoin SV ecosystem, Elas Digital aired its views on Bitcoin and Satoshi’s vision for global P2P electronic cash in June. In a 14-page paper, the Brendan Lee-led firm outlined what Bitcoin is, the waylaying of Satoshi’s original Bitcoin vision by the BTC cartel, BSV’s capabilities, its use to underpin a national ledger in Tuvalu and more.
Now, the committee has finally published its long-awaited report. On exchanges, the regulators have proposed a new market license that will consider such factors as auditing and capital reserves. This license will seek to protect the smaller players by making the requirements proportional to the size of the enterprise.
For block reward miners, the report proposed a 10% company tax discount if they use renewable energy. The tax discount is in contrast with the hardline stance taken by China on miners and could prove to be an incentive that puts Australia on the map as a mining haven. With block reward mining coming under scrutiny for its carbon footprint, the discount could also incentivize green energy use which would be a welcome direction for the embattled industry.
The committee also recommended that the government establish a DAO company structure; amend the capital gains tax law to reflect the nature of digital currency volatility; and conduct a CBDC viability study.
Australia’s digital currency industry has welcomed the proposals, saying they could set the stage for explosive growth of the industry. CoinJar exchange CEO Asher Tan remarked, “In our view, the AFTC report strikes a commendably optimistic tone that sees blockchain technology as the historic innovation that it is—and one that comes with matching opportunities and risks.”
Watch: CoinGeek Zurich panel, Tuvalu: A Country’s National Digital Ledger on BSV
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