Australia has implemented new legislation to increase control of the cryptocurrency business and combat financial crimes. The Australian Transaction Reports and Analysis Centre (AUSTRAC) has suggested these changes to address existing regulatory loopholes and reinforce anti-money laundering and terrorism funding safeguards.
The Anti-Money Laundering and Counter-Terrorist Financing (AML/CTF) Act underwent modifications with the passage of these new regulations in November. AUSTRAC’s plan emphasizes tighter regulations for enterprises in high-risk industries such as cryptocurrency exchanges, real estate, and legal services.
The proposal includes strengthened customer due diligence (CDD) standards, which require corporations to verify identities, monitor suspicious transactions, and promote transparency in cross-border asset transfers. The framework also includes revisions to the Travel Rule, which enhance controls for overseas transactions and avoid misuse.
To streamline compliance, AUSTRAC has taken an outcomes-based approach, which allows firms to adjust their compliance plans based on their size, structure, and risk profile. This replaces the one-size-fits-all strategy, lowering wasteful costs while maintaining high regulatory standards.
The plan also revises current laws, such as the AML/CTF General Rule 2025 and the AML/CTF (exclusions) Rule 2007, to keep essential exclusions while eliminating outmoded restrictions.
AUSTRAC has established a public consultation period until February 14, 2025, and is seeking opinion from stakeholders such as cryptocurrency startups, financial institutions, and legal professionals. This endeavor is part of Australia’s larger campaign to combat cryptocurrency misuse, which includes forming a task group to regulate crypto ATM operators.
By implementing these steps, Australia hopes to enhance its financial regulatory framework and close loopholes in the cryptocurrency business, resulting in more accountability and security.
