Australia’s financial watchdog is proposing stricter rules for crypto platforms, covering how they protect customer funds, manage trading, handle transactions, and maintain enough money to run their businesses.
The changes could require some firms to update their licences and operations before Australia’s new digital asset rules take effect in April 2027.
ASIC Sets Out New Licensing Requirements for Crypto Platforms
On 15, October, the Australian Securities and Investments Commission (ASIC) released Consultation Paper 392 to explain how digital asset platforms and tokenized custody providers would be regulated under Australia’s existing financial services system.
Under the new framework, affected businesses would need to apply for or update an Australian financial services licence. They may also need to provide customer disclosure documents and platform rules.
However, obtaining a licence is only one part of the proposed requirements.
ASIC Commissioner Alan Kirkland said that,
“Our approach is based on the principle of ‘same activity, same risk, same regulatory outcome’ to align Australia with the approach of comparable overseas jurisdictions.”
ASIC’s Three Rules: Safety, Fair Trading and Financial Strength
The first area is Customer Asset Protection. Crypto exchanges would need to follow stricter custody standards, including requirements for managing private keys. These measures aim to reduce the risk of customers losing access to their assets if a platform experiences financial problems.
The second area is Fair Trading. Platforms would be expected to monitor trading activity and address practices such as market manipulation. ASIC’s proposals also seek to restrict platforms from trading against their own customers, helping reduce potential conflicts of interest.
The third area is Financial Strength. Depending on their activities, businesses could face capital requirements, including net tangible asset standards. ASIC has indicated that some operators may need as much as A$14 million in net tangible assets, depending on the services they provide.
Crypto Businesses Get Until October 2027 to Apply for Licences
The new framework also sets out a transition period for eligible crypto businesses already operating in Australia. These firms will have until October 7, 2027, to submit their licence applications.
Businesses that meet the required conditions may continue operating while ASIC reviews their applications.
This gives existing operators time to prepare their applications and adjust their operations, even though the new licensing regime is scheduled to begin on April 8, 2027.
For now, ASIC is seeking feedback from crypto businesses and other stakeholders until November 27, 2026. The regulator expects to publish its final guidance and standards in March 2027, shortly before the new licensing regime begins.
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