Australia Plans Fines Up To 10% Of Turnover For Crypto Rule Breaches

What Happened

Australia’s regulators have repeatedly warned about the risks of surging retail crypto investment. The nation’s securities and prudential watchdogs, as well as the central bank, have pressed for tougher standards. In August, financial crimes agency AUSTRAC ordered Binance’s local arm to appoint an external auditor over money laundering and terrorism financing concerns.

The effort reflects a balancing act, with policymakers seeking to protect investors without stifling innovation. Industry feedback over the next month will shape the final framework before it moves toward parliament.

Separately, the Australian Securities and Investments Commission last week granted class relief to intermediaries distributing stablecoins issued by licensed AFS providers. The measure, which runs until June 2028, exempts them from separate market, clearing and settlement licences when handling stablecoins from approved issuers.

Market Context

These rules build on existing anti-money laundering obligations overseen by AUSTRAC and complement the Australian Taxation Office’s scrutiny of crypto transactions for capital gains tax.

Why It Matters

The relief is the first of its kind in Australia, signalling regulators’ willingness to provide flexibility where oversight is already embedded in existing financial licences.

Details

Australia plans to hit digital asset platforms with penalties of up to 10% of annual turnover if they breach new rules, under draft legislation released on Thursday.

The proposal requires exchanges and other operators to secure an Australian Financial Services Licence. Firms that fail to act honestly and fairly, or that engage in misleading conduct and unfair contract terms, would face the greater of three penalties, A$16.5m (US$10.9m), three times the benefit gained, or 10% of annual turnover.

Consultation Period Set To Shape Rules For Industry Heavyweights

The ATO can already impose fines worth up to three times the amount evaded or pursue prison terms in cases of serious breaches.

The draft law will remain open for consultation until Oct. 24. It marks one of the most significant moves yet to regulate an industry that includes major global players such as Coinbase and Kraken.

New Rules Extend Corporations Act To Digital Asset Platforms

Treasury said the new regime will bring digital asset and tokenized custody platforms under the Corporations Act, extending consumer protections and formal licensing requirements.

Smaller players will not face the full burden. Platforms that hold less than A$5,000 per customer and process under A$10m in annual transactions will be exempt.

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