Australian Financial Planning Association backs 'crypto rulebook'
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Australian Financial Planning Association backs 'crypto rulebook'
The Financial Planning Association of Australia (FPA) is showing its support for a "cryptocurrency rulebook", calling for regulating crypto assets through exchanges and arguing that it would be too difficult to regulate the underlying assets separately. . Regulate exchanges, not technologyBen Marshan, the FPA's head of policy, strategy and innovation, said that "regulation of a financial product or service should not depend on the technology that underpins the asset", adding.
Marshan is of the opinion that it would be nearly impossible to regulate the way assets are held, in addition to regulating exchanges: “[products are] so decentralized, they are in all kinds of foreign jurisdictions.” He further added that the regulation of crypto should fall under the current financial services regime, and not under a new separate legal framework. Focusing on crypto service providers, such as exchanges, will take a lot of "complexity" out of the equation.
Marshan is of the view that if a rule book is adopted, it would allow financial planners to recommend crypto assets to their clients along with specific training in related crypto strategies. “At the moment, this is effectively illegal because there is no authority around crypto assets,” Marshan said, “and because of this financial planners cannot recommend them and obtain professional indemnity insurance.”
Calls on Government for Clearer Regulation While the FPA is pledging its support for implementing a "cryptocurrency rulebook", many have called for Australia's new Labor government to have clearer regulation in terms of crypto. In 2021, Australian cryptocurrency scams caused a total of $84 million in losses, which many argue could have been avoided if the previous government had made clearer rules regarding digital assets.The new government is unlikely to change its stance, having recently confirmed that crypto is not a foreign currency and will remain subject to capital gains tax.