The Australian Government is currently reviewing its regulatory environment for cryptocurrency and other digital assets. On October 28th, 2021, the Select Committee on Australia as a Technology and Financial Centre issued a final report with 12 recommendations.
VASPs have largely remained unregulated in Australia to date. Currently, digital currency exchange providers have to register with AUSTRAC and comply with the Australian AML/CTF regime, as well as capture cryptocurrency trading for the purposes of Capital Gains Tax collection.
AUSTRAC is responsible for implementing guidelines released by the FATF on VASPs, in particular, the travel rule.
AML and CFT Act 2006: https://www.legislation.gov.au/Details/C2021C00243
When do you need to comply?
The Australian Government is in the process of reviewing its regulatory environment for virtual assets. There is thus no obligation to comply yet. However, you may need to have a solution in place when interacting with other obliged entities located in countries where the travel rule has been implemented.
Have a plan in place and start interacting with the right providers that can help you comply with the travel without impairing your customer relationship.
What else do you need to know?
The Committee recommended that:
The Government establish a market licensing regime for Digital Currency Exchanges (DCEs), including capital adequacy, auditing and responsible person tests under the Treasury portfolio.
The Government establishes a custody or depository regime for digital assets with minimum standards under the Treasury portfolio.
The Government conducts a token mapping exercise to determine the best way to characterise the various types of digital asset tokens in Australia.
The Government establish a new Decentralised Autonomous Organisation company structure.
The Anti-Money Laundering and Counter-Terrorism Financing regulations be clarified to ensure they are fit for purpose, do not undermine innovation and give consideration to the driver of the Financial Action Task Force (FATF) "travel rule".