Australia’s securities regulator has begun consulting on a new set of rules for crypto platforms as the country prepares to bring a broader digital asset law into force in 2027. The draft proposals cover capital, custody and trading requirements for operators that will need to be licensed under the upcoming framework.

The consultation follows Parliament’s passage in April of the Corporations Amendment (Digital Assets Framework) Act, which expands formal oversight of the sector. ASIC said the planned guidance and standards are intended to give platforms clearer expectations on licensing, customer asset protection and financial obligations as digital assets and tokenization take on a larger role.

What the draft rules include

ASIC’s proposal sets out three alternative capital models for crypto platforms, alongside restrictions on firms trading for their own account. The draft also calls for quarterly reporting on wallets that hold customer assets, a measure aimed at strengthening oversight of custody arrangements.

The consultation also examines whether offshore custody should be permitted and what safeguards may be needed if an overseas parent company or other related entity were to fail. Those issues sit alongside broader requirements on how operators would protect client assets and meet financial standards under the new regime.

Debate over burden and flexibility

Views across the industry are mixed. Some participants see the standards as a necessary and proportionate response to the risks associated with crypto platforms, while others argue the framework should recognize firms that have already invested in compliance and should avoid placing unnecessary pressure on established operators.

Among the main points of debate are the design of the capital models, the choice between domestic and offshore custody, and proposed limits on principal trading or related-party arrangements. Those restrictions are being considered as part of efforts to reduce conflicts of interest within platform operations.

Licensing path under the new framework

ASIC said the proposed standards are meant to help operators understand what they will need to do to obtain a license once the law takes effect. The regulator is also hearing calls for a more streamlined licensing pathway for established operators that can demonstrate compliance with the new requirements.

The broader legal framework is scheduled to commence on April 8, 2027. From that point, crypto platform operators will have until Oct. 7, 2027, to apply for the relevant license, and they will be allowed to continue operating on a provisional basis while their applications are assessed.

Next steps before implementation

Submissions on the consultation are due by Nov. 27. ASIC plans to finalize the standards in March 2027, shortly before the legislation comes into force.

That leaves several core policy choices still open, including how much capital platforms should hold, how custody can be structured and how tightly platforms should be limited in trading on their own behalf. The consultation process is the next confirmed step before the new regime begins operating.

Source: cointelegraph.com