The bill also seeks to address the rise of central bank-issued digital currencies (CBDCs), most notably China’s e-yuan, the first CBDC issued by a major economy. . Under the proposed law, China’s state-owned banks will be required to report their use of electronic yuan to the Reserve Bank and banking regulator APRA.
E-Yuan is not yet available in Australia, but Bragg said the bill will ensure Australia is prepared when it becomes available.
“We want to make sure all reporting mechanisms are in place. If the digital yuan becomes a popular option among the unbanked in the Wouldn’t you like to think about how to respond to that?” he said.
Australia lags far behind many of its international peers when it comes to regulating cryptocurrencies, with the United States this week releasing a framework for what domestic regulation should look like, with the state of Wyoming Some states, such as the United States, have introduced regulations in favor of cryptocurrencies.
Industry officials in Australia strongly support further regulation, although some have expressed concern that the rapidly evolving nature of the industry means that the regulations introduced may not keep up with new developments.
For example, last week the second largest crypto, Ethereum, The long-awaited “merger”, Transform the network from a power-intensive “proof of work” consensus algorithm to a more efficient “proof of stake” system.
However, due to the nature of the change, Ethereum holders will be able to lock up (or “stake”) their cryptocurrencies for rewards, said the chairman of North American financial regulators. He said the assets could now be considered securities and could be subject to new laws.
Bragg said such issues are always a risk when trying to regulate emerging markets, but he believes the bill has an adequate framework to cover most scenarios. It was drafted to set some ‘must-haves’, but the rest is left to regulation and the minister of the day can make the decisions,” he says. “You can’t lock everything into a bill because it’s dated from the moment it’s passed.”