Feb 04, 2023
Australia Launches Crypto Taxonomy Consultation
The race to regulate the web3 space is on, and Australia is leading the charge. On Feb. 3, the Australian Treasury released a consultation paper on “token mapping”, outlining a “fact-based, consumer conscious and innovation-friendly” approach to policy development. This is the first step in the government’s multistage reform agenda to regulate the crypto industry.
The paper defines four major types of crypto-related products: crypto asset services, intermediated crypto assets, network tokens, and smart contracts. Crypto asset services include lending and borrowing, fiat on/off ramping, crypto token trading, funds management, mining/staking-as-a-service, gambling, and custody. Intermediated crypto assets refer to rights or licenses in relation to event access or subscriptions, intellectual property, reward programs, consumer goods and services, fiat money, nonfinancial assets, and government bond coupons. Network tokens are a “new type of currency” constituting peer-to-peer payment infrastructure, such as Bitcoin (BTC). Lastly, smart contracts exist on a spectrum from “intermediated” to “public”, with intermediaries using the former and parties using the latter to remove the need for an intermediary.
The paper proposes to start the discussion on this taxonomy and doesn’t provide any legislative initiatives. However, the authors anticipate a relatively easy tailoring of existing laws for a large portion of the crypto ecosystem. Public, self-service software could demand the creation of a brand-new legislative framework.
The Treasury will wait for feedback up until March 3. The next major step of the national regulatory discussion will come with a release of a similar paper on the possible licensing and custody framework for crypto in mid-2023.
The UK is also making advances in the web3 space. On Feb. 1, His Majesty’s Treasury of the United Kingdom published its consultation paper for the crypto regulation. In it, the financial authority emphasized the capacity of the existing Financial Services and Markets Act to cover digital assets, and the lack of necessity for separate legislation.
The ever-evolving web3 space is a hot topic for governments and regulators around the world. The need for regulation is driven by the increasing popularity of NFTs, and the need to protect consumers as they engage in crypto activities. As such, the Australian Treasury’s consultation paper is a significant step in the right direction.
The paper’s proposed taxonomy is set to provide clarity to the industry, allowing for better understanding of the different types of crypto-related products and services. This will help to ensure that the web3 space is regulated in a way that is fair and transparent, while still allowing for innovation and growth.
The consultation paper also provides an opportunity for businesses to get involved with NFT marketing and promotion. By leveraging the proposed taxonomy, businesses can develop effective strategies for selling NFTs and engaging in crypto activities. This could include working with a NFT marketing agency or web3 agency to create a comprehensive Twitter NFT marketing plan.
Ultimately, the Australian Treasury’s consultation paper is a positive step for the web3 space. It is set to provide clarity to the industry and ensure that the crypto market is regulated in a way that is fair and transparent. It also provides an opportunity for businesses to get involved with NFT marketing and promotion, allowing them to effectively engage in crypto activities.
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