Liberal senator Bragg plans to introduce a private member's bill at the parliament's next sitting, including new rules for digital asset exchanges, digital asset custody services, stablecoin issuers, and disclosure requirements for facilitators of the e-Yuan in Australia.
In a statement issued on Monday, the senator announced that in order to rectify Labor's alleged failures, he is releasing a draft bill for consultation called the Digital Assets (Market Regulation) Bill 2022.
“It is essential that the parliament drives law reform when the Labor government is indolent and only responsive to vested interests,” Senator Bragg said.
Speaking to ABC RN Breakfast on Monday, the senator explained that, besides regulating the use of crypto at home, his bill also addresses the rise of central bank-issued digital currencies, including one from China.
“The Chinese government is piloting what they call the digital Yuan, which is a digital form of currency and they're currently controlling that outside of China as well with the UAE and Hong Kong and Thailand.
“Now that currency — if it became widespread in the Pacific or even within Australia — would give the Chinese state enormous power, economic and strategic power, that it doesn't have today and so, I think we need to be prepared for that. We need to know more about this digital currency and so the bill establishes reporting requirements in that regard,” he explained.
Citing “huge consumer risks” and accusing the Labor government of “starting its work from scratch”, Senator Bragg argued that his bill is intended to “show that it wouldn't be too hard to achieve regulation” in the crypto space.
Last month, the Albanese government announced a world-first “token mapping” project to commence this year, with the aim to “improve” the way Australia's regulatory system manages crypto-assets.
Token mapping will seek to determine the characteristics of all the digital tokens available in Australia, providing the government with the crucial knowledge to tackle fresh regulation in the crypto area.
“This hasn't been done anywhere else in the world, so it will make Australia leaders in this work,” the Minister for Financial Services, Stephen Jones, and Assistant Minister for Competition, Charities and Treasury, Andrew Leigh, said in a joint statement in August.
The government's ultimate goal is to ensure “customers engaging with crypto are adequately informed and protected”, but in a manner that embraces new and innovative technologies.
While the government's resolve to tighten crypto rules has been welcomed by experts, Professor Barney Tan, head of the School of Information Systems and Technology Management at UNSW Business School, warned that it could have significant impacts on financial services and fintech companies.
“They will have to offer more transparency about the crypto-assets they are offering,” Mr Tan said.
The Australian Taxation Office estimates that more than one million taxpayers have interacted with the crypto-asset ecosystem since 2018.