AUSSIE CONSUMER GROUP CALLS FOR BETTER CRYPTO REGS DUE TO LAGGING LAWS

The world of cryptocurrency is rapidly evolving, presenting both exciting opportunities and significant risks for Australian consumers.As more and more Australians dip their toes into the digital asset market, a critical question arises: are our regulations keeping pace? Australian consumer advocacy group CHOICE has called on the federal government to provide better protection for crypto investors while submitting a proposed regulatory framework for cryptocurrency exchanges operating in the country. The regulatory framework was submitted in response to the federal Treasury s consultation paper for crypto asset secondary service providers (CASSPsThe answer, according to leading consumer advocacy group CHOICE, is a resounding no. Australian consumer group CHOICE outlined its crypto regulatory framework in a submission to the country s Treasury calling for the new federal governmentWith the crypto market booming and Australians increasingly investing in assets like Bitcoin and Ethereum, CHOICE is raising the alarm about the lack of adequate consumer protections. Menu. Home; Bitcoin Chart; Cryptocurrency News; Cryptocurrency Software; Privacy PolicyThey argue that current laws are lagging behind, leaving investors vulnerable to scams, misleading advertising, and other potential pitfalls.To address this growing concern, CHOICE has taken a proactive step, submitting a proposed regulatory framework to the federal government, urging them to prioritize crypto regulation in their financial services reforms. Australian consumer advocacy group CHOICE has called on the federal government to provide better protection for crypto investors while submitting a proposedThis framework aims to create a safer and more transparent environment for crypto investors, ensuring that the innovative potential of digital assets is not overshadowed by unchecked risks. Aussie consumer group calls for better crypto regs due to lagging laws Cointelegraph By Jesse Coghlan UncategorizedThis move signals a growing consensus that Australia needs to catch up to the realities of the crypto market and provide its citizens with the protections they deserve.

The Urgent Need for Updated Crypto Regulations in Australia

The core issue at hand is the significant gap between the rapid growth of the cryptocurrency market and the slow pace of regulatory development in Australia. Aussie consumer group calls for better crypto regs due to Coin SurgesWhile the allure of high returns and technological innovation attracts investors, the absence of clear and comprehensive regulations creates a breeding ground for uncertainty and potential harm.

CHOICE's senior policy adviser, Patrick Veyret, aptly summarized the situation, stating that the crypto market is booming, but our laws are lagging behind. Australia s innovative spirit demands proactive regulation to stay ahead in the digital assets revolution and the crypto industry should not be treated as an afterthought.This disparity leaves Australians who are purchasing crypto assets exposed to unnecessary risks. Commenting on the current regulations CHOICE s senior policy adviser Patrick Veyret said: The crypto market is booming, but our laws are lagging behind, more and more Australians are purchasing crypto assets such as Bitcoin and Ethereum without adequate consumer protections.The lack of regulation also hinders the development of a mature and sustainable crypto industry in Australia.

Why Current Regulations are Insufficient

Several factors contribute to the inadequacy of existing regulations. Australian consumer advocacy group CHOICE has called on the federal government to provide better protection for crypto investors while submitting a proposed regulatory framework for cryptocurrency exchanges operating in the country.The regulatory framework was submitted in response to the federal Treasury's consultation paper for crypto asset secondary service providers (CASSPs) definedThese include:

• Lack of a Unified Definition: The absence of a single, consistent definition of ""crypto"" across different regulatory bodies creates confusion and loopholes that can be exploited.
• Inadequate Licensing Requirements: Current licensing requirements for crypto exchanges are not as stringent as those for traditional financial institutions, leaving consumers with fewer protections.
• Insufficient Consumer Protection Laws: Crypto exchanges are not always bound by the same consumer protection laws that apply to other financial service providers, leaving consumers vulnerable to unfair practices.

CHOICE's Proposed Regulatory Framework: A Roadmap for Protection

Recognizing the urgent need for reform, CHOICE has developed a comprehensive regulatory framework designed to address the key shortcomings in the current system.This framework aims to strike a balance between fostering innovation and protecting consumers.

The proposed framework focuses on four key areas:

1. Establishing a Clear Definition of Crypto Assets: A single, consistent definition of ""crypto asset"" is crucial for clarity and consistency in regulation. Australian consumer advocacy group CHOICE has called on the federal government to provide better protection for crypto investors while submitting a proposed regulatory framework for cryptocurrencyThis definition should encompass all types of cryptocurrencies, tokens, and other digital assets.
2. Implementing Licensing Requirements for Crypto Exchanges: Crypto exchanges should be subject to licensing requirements that are comparable to those for other financial institutions.This would ensure that exchanges meet certain standards for security, financial stability, and consumer protection.
3. Applying Consumer Protection Laws to Crypto Transactions: Crypto transactions should be subject to the same consumer protection laws that apply to other financial transactions.This would protect consumers from misleading advertising, unfair contract terms, and other harmful practices.
4. Establishing a National Regulatory Body: A dedicated national regulatory body should be established to oversee the cryptocurrency industry.This body would be responsible for enforcing regulations, investigating complaints, and providing guidance to consumers and businesses.

Specific Recommendations within the Framework

CHOICE's framework goes beyond broad principles, offering specific recommendations for implementation.Some of these recommendations include:

• Mandatory disclosure requirements: Crypto exchanges should be required to disclose all relevant information about the risks and potential benefits of investing in crypto assets.
• Cooling-off periods: Consumers should have a cooling-off period after purchasing crypto assets, during which they can cancel the transaction without penalty.
• Dispute resolution mechanisms: Accessible and effective dispute resolution mechanisms should be available to consumers who have disputes with crypto exchanges.
• Advertising standards: Stricter advertising standards should be implemented to prevent misleading or deceptive claims about crypto assets.

The National Consumer Credit Protection Act 2025 (NCCP Act) and Crypto Lending

A key aspect of regulating the crypto space involves addressing crypto lending and credit activities.The proposed framework aligns with the National Consumer Credit Protection Act 2025 (NCCP Act), which aims to extend consumer credit protections to crypto lending platforms.This means that entities involved in crypto lending and credit activities would be required to hold an Australian credit license or be exempt, ensuring compliance with responsible lending practices. Aussie consumer group calls for better crypto regs due to lagging lawsThis is crucial for preventing predatory lending practices and protecting consumers from taking on unsustainable levels of debt.

The Role of ASIC and the Need for a Dedicated Regulatory Body

Currently, the Australian Securities and Investments Commission (ASIC) plays a role in regulating the crypto market, but its powers are limited.While ASIC has registered approximately 400 crypto exchanges, CHOICE argues that a dedicated national regulatory body is needed to provide more focused and effective oversight. Consumer advocate group CHOICE has called on the Australian government to better protect crypto investors and submitted a proposed legal framework as the country s Treasury consults on how to regulate crypto exchanges.This dedicated body would have the resources and expertise to address the unique challenges posed by the cryptocurrency industry and to ensure that regulations are enforced consistently and effectively.This would not only protect consumers but also foster greater confidence and stability in the market, attracting responsible businesses and innovation.

Addressing Common Concerns and Misconceptions about Crypto Regulation

The debate around crypto regulation often involves misconceptions and concerns about stifling innovation.It's important to address these concerns and highlight the benefits of a well-regulated market.

Will Regulation Stifle Innovation?

A common argument against regulation is that it will stifle innovation and drive businesses overseas. National Consumer Credit Protection Act 2025 (NCCP Act): Applies to crypto lending and credit activities, requiring relevant entities to hold an Australian credit license or be exempt. Cryptocurrency regulations are determined at a federal level in Australia, which means obligations are the same across all states and territories in the country.However, CHOICE argues that the opposite is true. Outlining four main areas in its framework, the group called for a single definition of crypto for better regulation, a license for exchanges in line with current financial licensing, and for them to be bound by consumer protection laws to prohibit things like misleading advertising.Clear and well-defined regulations can provide a stable and predictable environment that fosters innovation and attracts investment.By reducing uncertainty and protecting consumers, regulation can build trust in the crypto market and encourage responsible growth.

For example, robust KYC (Know Your Customer) and AML (Anti-Money Laundering) regulations can prevent illicit activities, making the Australian crypto market more attractive to legitimate businesses and investors.

Is Crypto Regulation a Global Trend?

Yes, many countries around the world are actively developing and implementing regulations for the cryptocurrency industry.This reflects a growing recognition of the need to address the risks and opportunities associated with digital assets.Countries like the United States, the United Kingdom, and Singapore are all exploring different regulatory approaches, demonstrating a global consensus that regulation is necessary. Australian consumer group CHOICE outlined its crypto regulatory framework in a submission to the country s Treasury, calling for the new federal government to prioritize crypto in its financial services reforms. Australian consumer advocacy group CHOICE has called on the federal government to provide better protection for crypto investors while submitting a proposed regulatory framework forAustralia risks falling behind if it fails to keep pace with these developments.

Practical Steps for Consumers in the Current Regulatory Landscape

While waiting for more comprehensive regulations, consumers can take several steps to protect themselves in the current crypto market:

• Do Your Research: Before investing in any crypto asset, thoroughly research the asset and the platform you are using. In short: Industry figures say cryptocurrency consumers and businesses have been left in the lurch by a lack of regulation. ASIC says there are 400 registered crypto exchanges in Australia butUnderstand the risks involved and be wary of unrealistic promises.
• Diversify Your Investments: Don't put all your eggs in one basket.Diversify your crypto investments across different assets to reduce your overall risk.
• Use Secure Platforms: Choose crypto exchanges and wallets that have strong security measures in place, such as two-factor authentication and cold storage.
• Be Wary of Scams: Be suspicious of unsolicited offers, guarantees of high returns, and requests for personal information.
• Keep Your Private Keys Safe: Never share your private keys with anyone.Store them securely in a hardware wallet or other secure location.

The Federal Government's Role: A Call to Action

Ultimately, the responsibility for creating a safer and more transparent crypto market rests with the federal government.CHOICE's submission to the Treasury represents a call to action, urging the government to prioritize crypto regulation as part of its broader financial services reforms.The government's response will be crucial in shaping the future of the crypto industry in Australia.

Key Actions for the Government to Take:

1. Expedite the development and implementation of a comprehensive regulatory framework.
2. Establish a dedicated national regulatory body for the cryptocurrency industry.
3. Allocate sufficient resources to ASIC to enforce existing regulations.
4. Work with international partners to harmonize crypto regulations.
5. Educate consumers about the risks and opportunities associated with crypto assets.

The Future of Crypto in Australia: A Vision for a Responsible and Innovative Market

The future of crypto in Australia depends on creating a regulatory environment that fosters innovation while protecting consumers.By implementing the recommendations outlined in CHOICE's framework, Australia can position itself as a leader in the digital asset space, attracting responsible businesses and fostering economic growth.A well-regulated market will not only protect consumers but also build trust and confidence in the crypto industry, paving the way for a more sustainable and prosperous future.

Conclusion: Protecting Consumers and Fostering Innovation in the Crypto Space

CHOICE's call for better crypto regulations in Australia highlights a critical need to update lagging laws and provide adequate consumer protections in the rapidly evolving digital asset market.As more Australians invest in cryptocurrencies, the risks associated with inadequate regulations become increasingly apparent.The proposed regulatory framework submitted by CHOICE offers a comprehensive roadmap for addressing these challenges, emphasizing the importance of a clear definition of crypto assets, robust licensing requirements for exchanges, and the application of consumer protection laws to crypto transactions.By taking proactive steps to regulate the crypto space, the Australian government can protect consumers, foster innovation, and ensure that the country remains at the forefront of the digital asset revolution.Ignoring this call for action risks leaving Australian consumers vulnerable and hindering the development of a responsible and sustainable crypto industry.It's time for Australia to prioritize crypto regulations and create a framework that balances innovation with consumer protection.Ultimately, the goal is to create a vibrant and trustworthy crypto ecosystem that benefits both consumers and the broader economy.