Australia's ASIC proposes tougher standards for crypto exchanges and custodians
In brief
- ASIC opened a consultation Thursday on proposed standards for crypto exchanges and custodians.
- Customer asset safeguarding, trading transparency, settlement and financial resources are covered by the proposals.
- Nov. 27 is the consultation deadline; final guidance and standards are expected in March 2027.
- More than 140 applications for digital asset authorization have been recorded, ASIC said.
- Payment stablecoins are being handled separately through payment services reforms.
What ASIC is proposing
Under the consultation paper, platforms would be subject to standards on separating and safeguarding customer assets, trading transparency, settlement procedures and financial resources. That's the core of it. The proposed trading rules also address market manipulation, conflicts of interest and how exchanges handle customer orders (the plumbing most users don't think about until something breaks).
For Australian investors, CoinDesk reported, the changes would mean clearer rules on how exchanges hold assets, execute orders and handle conflicts of interest. Crypto companies would face new compliance obligations and financial requirements to operate legally in the country.
ASIC said stablecoins used for payments aren't part of this package. They're being addressed separately through Australia's payment services reforms.
"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 Commissioner Alan Kirkland said.
These are still proposals, not final requirements.
Timeline and the licensing queue
Final guidance and standards are expected in March 2027. According to CoinDesk's report, the rules take effect on April 8, 2027, and crypto firms already operating in Australia have until "Oct. 7 of the next year" to apply for a license. They can keep operating while ASIC reviews their applications.
The queue is already forming. ASIC said it's recorded more than 140 applications from businesses seeking authorization to provide digital asset-related financial services.
Why Australia is moving now
CoinDesk described the proposals as the next step in Australia's effort to bring crypto businesses under the same regulatory framework as traditional financial firms. Parliament passed the underlying legislation in April, putting Australia alongside the European Union, Singapore and Hong Kong, which have introduced dedicated crypto regulations.
The regional history explains a lot. The 2022 collapse of FTX left about 30,000 Australian customers unable to access their money, and three years before that, Cryptopia (an exchange in neighboring New Zealand) went bankrupt after a major hack.
Frequently asked questions
What do ASIC's proposed crypto exchange rules cover?
Under ASIC's consultation paper, platforms would face standards on separating and safeguarding customer assets, trading transparency, settlement procedures and financial resources. The proposed trading rules also address market manipulation, conflicts of interest and how exchanges handle customer orders.
When do Australia's new crypto rules take effect?
ASIC's consultation closes on Nov. 27, with final guidance and standards expected in March 2027. CoinDesk reported the rules take effect on April 8, 2027, and that existing firms have until "Oct. 7 of the next year" to apply for a license while continuing to operate.
Do the proposed ASIC rules apply to payment stablecoins?
No. ASIC said stablecoins used for payments are being addressed separately through Australia's payment services reforms, not through this consultation on exchanges and custodians.
