The Australian financial market watchdog has announced that it was working with legislatures to create a crypto regulatory framework. However, the regulators stated that at the moment, cryptocurrencies were highly unregulated, and investors who interacted with these assets were “on their own.”
The revelation comes as the market records major gains, and Australia takes a significant portion of the global crypto share.
Australian investors urged to be cautious with crypto
Longo’s comments come as the largest bank in Australia announced that I would start offering cryptocurrency products. Earlier this month, the Commonwealth Bank of Australia became the first major banking institution in developed economies to launch a platform that allows retail traders to access cryptocurrencies.
Moreover, the demand for crypto assets in Australia is high, which could see other financial institutions following suit and launching similar offerings. Longo acknowledged this demand stating that there was “extraordinary consumer and investor demand.” However, he stated that the involvement of consumers with these assets was huge.
“Consumers should approach investing in crypto with great caution,” said Longo in his recent remarks at the Australian Financial Review Conference. “At present, many crypto-assets are probably not ‘financial products’… for the most part, for now at least, investors are on their own.”
ASIC working on a crypto regulatory framework
The ASIC noted that it was working together with legislatures to create a clear regulatory framework that would protect investors and govern firms’ operations that deal in crypto assets.
Longo stated that with this collaboration with lawmakers, Australia would have a new law that permits decentralized autonomous organizations (DAOs) to operate in the country. Such firms do not have a physical location or board of directors, but they are governed by artificial intelligence.
The new regulations would also offer a licensing regime for cryptocurrency exchanges in the country. Longo also added that “ASIC does not strive to eliminate risk. But, nor should we ignore it.”
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