The Australian Federal Government is working on a regulatory framework for “entities providing access to digital assets” and is seeking industry input. The intention, it said, is to bring Australian regulations in line with those overseas, using existing financial frameworks. The idea is to regulate intermediaries like exchanges, service/asset issuers, and financial product advisers.The policy proposals come a week after the Treasury also signaled its intention to regulate the (non-blockchain) digital payments industry, broadening its definitions of payments and assets. While the focus of the digital payments proposal was international transfers and national security risks, the digital assets document looks more at consumer protection and “promoting innovation through technology neutrality.”It referred specifically to the FTX exchange collapse, which it noted affected 50,000 Australian consumers. Past problems with FTX and digital asset exchanges, in general, had resulted from “ineffective management practices” and “inadequate governance structures,” as well as the usual suspects of fraudulent activities, poor resilience, and conflicts of interest.Using existing financial regulations as a guide, the Treasury said digital asset facilities would have minimum standards for holding assets, intermediating platform entitlements, and transactional functions.Any license changes would apply to businesses based in Australia, whether they serve only the Australian consumer market or act as a broker for others located elsewhere.Entities holding less than AU$5 million in total assets and individual clients holding less than AU$1,500 in entitlement value would be exempted.Token functions, ‘ownership’ and ‘functional control’Treasury clarified that its definition of a digital “token” includes only those that can be freely traded on third-party marketplaces, and (usually) not examples like event tickets and gift cards (even those that can be cryptographically signed). Digital assets, it added, function as non-physical “bearer asset” where the primary value of the token is the asset itself.However, one section acknowledges the challenges in differentiating between token types and determining what constitutes “ownership.” A digital token may represent various kinds of entitlements, from ownership of physical property or shareholding to a specific store discount. If a digital token is stolen, the thief has possession (or “factual control”) of the asset and its entitlements, but is not that token’s legal owner.“The programmability of digital tokens increases the uniqueness of token marketplaces further,” it said.Treasury’s policy proposals are more concerned with the intermediaries that provide access to these assets and wallet storage—namely, exchanges. It suggested a new type of financial product called a “digital asset facility” that would bring digital asset exchanges in line with existing Australian Financial Services Licence (AFSL) laws, regulating the intermediaries that facilitate storage, trades, and transfers of digital tokens. This “activities-based approach” focuses more on the services side rather than the token features themselves.“An important feature of the proposed framework would be that platform entitlements in relation to non-financial product assets do not become financial products,” it said. This allows token issuers more freedom to issue tokens representing physical assets or other values while protecting the token holders.Assets embedded with “financialised functions” would be subject to licensing requirements for their issuers, while non-financialised assets would not. However, any platform facilitating trade and storing digital tokens of any type would be subject to licensing requirements.Tokens can represent value in non-financial industries like social media, gaming, health care, media and entertainment, fitness, and lifestyle. The definition of a digital asset “holder” can also be unclear, it noted, if tokens are programmed with conditions that must be met, multiple sign-offs required to use, etc. Therefore, it uses “factual control in a real and immediate sense” as a suggestion.“There are also some digital assets that do nothing and others that were created for harmful purposes such as scams.”The Treasury said the policy proposals do not apply to “stablecoin” providers, merchants accepting tokens as payment, or any provider “publishing data to a public database” (e.g., a blockchain). However, these activities are already covered by existing laws that apply to their specific industries, such as contracts, intellectual property, privacy, and defamation.Once again, the Treasury is seeking public and industry feedback on its thoughts, with a deadline for written submissions on December 1, 2023. Its document on the topic contained a reminder that these are demonstrations of “policy intention” only and not draft laws. Any new law passed, as a result, would still have a 12-month transitionary period for the digital asset industry to make any changes necessary to comply#australia #coingeek

🛑An Australian🇦🇺 financial institution has placed restrictions🚫 on the transfer of funds to crypto currency exchanges due to concerns over fraudulent activities.

🛑The commonwealth bank off Australia implementing stricter regulations to limit it's customers ability to transfer funds to cryptocurrency exchanges . These measers are meaning implemented as a response to the increasing instances of fraudulent activities associated with cryptocurrencies

🛑The common wealth bank of Australia🇦🇺 has implemented measures to restrict it's customers capacity to transfer funds to crypto currency exchanges in response to the prevalence of crypto related scams. The bank has announced that it will promptly rejected or delay specific payments directed towards crypto exchanges and intends to establish a monthly limit of 💲10000 (AUD) on the amount it's customers can send to these exchanges.

#crypto2023 #australia #bank #news #crypto

The best alternative to achieve this goal in the setting of nations competing with cross-border currency circulation is central bank digital currency (CBDC). The Reserve Bank of Australia has announced that the eAUD, the digital equivalent of the Australian dollar, will soon begin a test phase. (RBA).

In a joint press release with Australia's Digital Finance Cooperative Research Centre, the RBA disclosed that it had requested a limited group of companies to help them examine 14 use cases for eAUD. The program is supported by businesses like ANZ and Mastercard.

A pilot CBDC, which is an actual digital claim on the Reserve Bank, will be used by a small group of industry players to illustrate potential applications for CBDCs.

The use cases chosen for the pilot were chosen for a variety of reasons, one of which was their potential to illuminate the advantages of a CBDC.

At the RBA, Brad Jones, Assistant Governor for the Financial System, stated:

"We are thrilled by the industry's active participation in this significant research endeavor. It has also been welcomed that a variety of Australian financial system actors, from minor fintechs to major financial institutions, have been invited to join in the trial as use case suppliers. The pilot and overall research study, which will be carried out concurrently, will serve two purposes: they will help industry gain practical experience, and they will help policy makers better understand how a CBDC might be advantageous for the Australian financial system and economy."

Examples of use cases include simplifying offline payments, creating secure invoices for companies, and even holding cattle auctions.

Another company featured in the publication was Canvas Digital, a layer-2 network built on top of Ethereum that uses zero-knowledge rollups to streamline transactions.

The settlement of foreign exchange transactions utilizing Circle's USDC stablecoin and the eAUD has been asked to be tested by Canvas, a network established in partnership with the Israeli company StarkWare.

Additionally, Japan declared that a CBDC pilot program would begin in April.

Many nations are now participating in the CBDC experiment. One of the pioneering nations with a digital yuan pilot program (e-CNY) is China.

#australia #cbdc #crypto2023

In a tale that reads like a modern-day financial thriller, an Australian man has seemingly vanished into thin air after a substantial sum of money—nearly half a million dollars—mistakenly found its way into his cryptocurrency account. This incident, involving Rhino Trading Pty Ltd, a cryptocurrency trading platform, has sparked intrigue and raised questions about the security and oversight within the digital currency space.
The Mistake That Started It All
The center of this bewildering story is Kow Seng Chai, a 37-year-old from Mildura, who became the unintended beneficiary of a significant clerical error. In what was supposed to be a routine transaction, Rhino Trading inadvertently added an extra zero to his account balance, inflating it to AUD $995,000 (approximately US $652,316), instead of the intended AUD $99,500 (US $65,237). The oversight turned Chai from an average crypto trader into a millionaire overnight.
Vanishing With The Wind
What followed is as perplexing as it is concerning. Chai, seemingly seizing the opportunity, engaged in a series of transactions that saw him convert some of the funds to Tether, a stablecoin, through an account associated with his business, Lotte Enterprise Pty Ltd. He proceeded to withdraw the funds in multiple installments, each hitting the maximum daily limit of US$100,000. By the time Rhino Trading detected the error on February 4, Chai had vanished, leaving the company in a predicament and prompting them to seek legal recourse. The Victorian Supreme Court has since issued a freezing order on Chai's assets and an injunction preventing him from leaving Australia.
Echoes of a Previous Incident
This incident eerily mirrors a previous case from 2021 involving another Melbourne couple and Crypto.com, where a similar clerical error led to an inadvertent transfer of AUD $10.5 million ($6.7 million) into their account. The couple, believing they had won a prize from the crypto exchange, spent the funds before the mistake was realized during an annual audit by Crypto.com. The subsequent legal battle saw one of the individuals pleading guilty to recklessly dealing with the proceeds of crime.
Reflections on Cryptocurrency Security
These incidents serve as stark reminders of the vulnerabilities inherent in the digital currency ecosystem. While cryptocurrency offers the allure of quick wealth and financial freedom, it also brings to the fore the critical need for stringent security measures and vigilant oversight by trading platforms. The cases of Kow Seng Chai and the Melbourne couple highlight the ease with which substantial sums can erroneously change hands and the complexities involved in rectifying such mistakes.
The Bigger Picture
As the digital currency market continues to evolve, these incidents underscore the importance of establishing robust protocols to prevent such errors from occurring in the first place. They also serve as cautionary tales for individuals and entities operating within the crypto space, reminding them of the potential consequences of exploiting these mistakes. The disappearance of Chai, following the windfall, opens up a Pandora's box of legal, ethical, and security questions, the answers to which could shape the future of cryptocurrency trading and regulation.
#crypto #australia #rhino

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,,The information and views presented in this article are intended solely for educational purposes and should not be taken as investment advice in any situation. The content of these pages should not be regarded as financial, investment, or any other form of advice. We caution that investing in cryptocurrencies can be risky and may lead to financial losses.“