Labor Senators note the increasing uptake of digital assets by Australian investors and consumers, especially among younger Australians.
Representatives of the cryptocurrency industry presented arguments to this inquiry that this increased uptake necessitates greater regulatory intervention to drive further growth and establish Australia as a global leader in Financial Technology.
It is the view of Labor Senators that the increased uptake of digital assets requires regulation to ensure the best interests of everyday Australian investors and consumers are protected—first and foremost—and that currently, regulatory shortfalls are leaving Australians at risk.
Labor Senators were concerned to note the prevalence of scams based on crypto asset product offerings. ASIC noted in its submission that scams relating to crypto-assets are an increasing problem, having received a significantly higher number of crypto-related scam reports, compared to previous years.
In relation to recommendations in the inquiry’s report advocating for various changes in taxation arrangements, Labor Senators note that the Government must ensure that any new financial arrangements meet global and community expectations on tax fairness.
Labor Senators acknowledge the heartfelt stories provided through evidence to the inquiry on the human impact de-banking has caused to the lives of individuals concerned.
Labor Senators were concerned that the Committee’s report did not identify any “technological solutions to address the driver of the travel rule”, despite suggesting that these should be adopted in the first instance. Labor Senators note that as at July 2021, the Financial Action Task Force’s advice is that “there has not yet been sufficient advancement in the global implementation of the travel rule or the development of associated technological solutions.”
The Financial Action Task Force has recommended that “all jurisdictions need to implement the revised FATF Standards, including travel rule requirements”. It is the view of Labor Senators that AUSTRAC should work with DCE’s to ensure that Australia’s AML/CTF controls do not create a permissive environment for terrorism financing and cybercrime and that this should include consideration of the implementation of a travel rule requirement.