Australia
June 4, 2026
20 min read
Australia operates a dual-regulator model for crypto payment services. AUSTRAC (Australian Transaction Reports and Analysis Centre) oversees anti-money laundering and counter-terrorism financing (AML/CTF) compliance, while ASIC (Australian Securities and Investments Commission) regulates market conduct and consumer protection. The Reserve Bank of Australia (RBA) holds payment system designation powers under the recently modernised Payment Systems (Regulation) Act 1998.
The regulatory landscape is undergoing a generational overhaul. The AML/CTF Amendment Act 2024 (Royal Assent 10 December 2024) expands AUSTRAC's remit from digital currency exchanges (DCEs) to all virtual asset service providers (VASPs/DASPs): enrolment for the new designated services opened 31 March 2026, with substantive AML/CTF obligations (including the Travel Rule) commencing 1 July 2026 and registration/compliance-officer notification due by 29 July 2026. The Treasury Laws Amendment (Payments System Modernisation) Act 2025 (Royal Assent 19 September 2025) broadens the RBA's payment system perimeter to capture crypto asset payment facilitators. The Corporations Amendment (Digital Assets Framework) Act 2026 (passed Parliament 1 April 2026, Royal Assent 8 April 2026) — formerly the Digital Asset Platform Bill — is now enacted and creates two new financial product categories (Digital Asset Platforms and Tokenised Custody Platforms) requiring AFSL licensing; it commences 9 April 2027 after a six-month transition.
Australia is a FATF member and has aligned its Travel Rule implementation with FATF Recommendations 15 and 16.
1. Legal Status
Crypto assets are not legal tender in Australia. They are generally classified as property for tax and contract-law purposes. Whether a particular token is also a financial product depends on its functional characteristics under the Corporations Act 2001.
Key distinctions:
- Not currency: Crypto cannot substitute the Australian Dollar (AUD) for mandatory acceptance
- Property for CGT: The ATO treats crypto disposals as capital gains tax events
- Potentially financial products: Tokens functioning as securities, derivatives, or managed investment scheme interests fall under ASIC jurisdiction
- Accepted for voluntary payments: No prohibition on merchants accepting crypto for goods and services
2. Regulatory Framework
Regulatory Architecture
| Regulator | Role | Key Authority |
|---|---|---|
| AUSTRAC | AML/CTF supervision; DCE/DASP registration | AML/CTF Act 2006; AML/CTF Amendment Act 2024 |
| ASIC | Consumer protection; financial product licensing; market conduct | Corporations Act 2001; ASIC Act 2001 |
| RBA (Payments System Board) | Payment system designation and oversight | Payment Systems (Regulation) Act 1998 (as amended 2025) |
| Treasury | Policy; legislative framework | Token Mapping; Digital Asset Platform Bill |
| Council of Financial Regulators (CFR) | Coordination body (RBA, APRA, ASIC, Treasury) | Regulatory perimeter reviews |
Primary Legislation and Instruments
| Instrument | Description | Status / Effective Date |
|---|---|---|
| AML/CTF Act 2006 | Original framework requiring DCE registration with AUSTRAC | In force |
| AML/CTF Amendment Act 2024 | Expands AUSTRAC scope to all VASPs/DASPs; introduces Travel Rule for VAs | Royal Assent 10 December 2024; enrolment opens 31 March 2026; obligations (incl. Travel Rule) from 1 July 2026 |
| AML/CTF Rules 2025 + transitional rules 2026 | Subordinate rules operationalising the 2024 amendments; transitional rules defer new VASP obligations | Rules tabled 31 August 2025; new VASP obligations deferred to 1 July 2026 |
| Payment Systems (Regulation) Act 1998 (as amended) | Broadens payment system perimeter to digital wallets, BNPL, crypto payment facilitators | Royal Assent 19 September 2025 |
| Treasury Token Mapping Consultation | Functional classification of crypto assets for regulation | Consultation closed 3 March 2023 |
| ASIC Consultation Paper 381 | Updates to INFO 225 on when crypto assets are financial products | Released December 2024; INFO 225 update / no-action position to 30 June 2026 |
| Corporations Amendment (Digital Assets Framework) Act 2026 | Requires AFSL for Digital Asset Platforms (DAPs) and Tokenised Custody Platforms (TCPs); small-platform exemption (<AUD 5,000/customer and <AUD 10m/year) | Enacted — passed 1 April 2026; Royal Assent 8 April 2026; commences 9 April 2027 (six-month transition) |
Sources:
- AUSTRAC: Digital Currency Exchange Providers
- Department of Home Affairs: Overview of the AML/CTF Amendment Act
- Treasury: Token Mapping Consultation
- Treasury Laws Amendment (Payments System Modernisation) Bill 2025
- RBA: Payments System Board Update November 2025
- Parliament of Australia: Corporations Amendment (Digital Assets Framework) Bill 2025
- Treasury Minister Mulino: New digital asset laws to unlock innovation and safeguard investment
- ASIC: Deadline looms for digital asset businesses to apply for a licence
3. AUSTRAC DCE / DASP Registration
Current Regime (DCE Registration)
Any business exchanging fiat currency for digital currency (or vice versa) must register as a Digital Currency Exchange (DCE) provider with AUSTRAC. This covers crypto exchanges, OTC desks, crypto ATMs, and wallets with buy/sell functionality.
Registration requirements:
- At least one Australian-resident director
- Australian business address (physical presence required)
- Minimum share capital of AUD 100 (nominal -- focus is on compliance readiness)
- Submission of an AML/CTF programme covering customer due diligence, transaction monitoring, staff training, and suspicious matter reporting
- Ongoing compliance with reporting obligations (SMRs, TTRs, IFTIs)
AUSTRAC actively enforces registration standards. In early 2025, the regulator suspended or refused renewals for nine providers in a single enforcement round.
Expanded Regime (Tranche 2 — VASP/DASP, 2026)
The AML/CTF Amendment Act 2024 replaces the narrow DCE definition with a broader virtual asset service provider (VASP / "digital asset service provider", DASP) category. AUSTRAC oversight extends to:
- Virtual asset transfers (not just fiat-crypto exchange) — including crypto-to-crypto exchange and transferors who move crypto for clients without holding it
- Custody and administration of virtual assets
- Participation in virtual asset issuance or sale
- Other services as prescribed
Phased commencement (per AUSTRAC transitional rules 2026):
| Step | Date | Detail |
|---|---|---|
| Enrolment opens | 31 March 2026 | Providers of new virtual asset designated services may enrol and register; from this date a business must not provide a VA designated service before AUSTRAC confirms registration |
| Obligations commence | 1 July 2026 | Substantive AML/CTF obligations — including risk-based programmes and the Travel Rule — take effect for both existing and newly regulated VASPs (no exemption) |
| Registration / compliance-officer deadline | 29 July 2026 | New VASPs must be registered and have notified AUSTRAC of their AML/CTF compliance officer (28 days after obligations commence) |
VASPs must register with AUSTRAC, implement risk-based AML/CTF programmes, and appoint an AML/CTF compliance officer.
Licensing / Registration Dimensions (AUSTRAC VASP registration)
| Dimension | Requirement | Status |
|---|---|---|
| Authority | AUSTRAC (registration), not a financial-services licence | Confirmed |
| Fixed capital | No prescribed minimum regulatory capital; legacy DCE company formation uses nominal share capital (~AUD 100) | Confirmed (nominal); no AML-specific capital floor — NOT VERIFIED as a regulatory requirement |
| Ongoing capital | None imposed by AUSTRAC registration | Confirmed (no AML capital requirement) |
| Substance / local presence | At least one Australian-resident director; Australian business address; AML/CTF compliance officer (a fit-and-proper officer in Australia) | Confirmed |
| Safeguarding of client assets | No AUSTRAC client-money/safeguarding rule; client-asset custody safeguards arrive via the Digital Assets Framework Act 2026 (ASIC/AFSL regime) | Confirmed (split across regulators) |
| Application cost | No statutory AUSTRAC registration fee published; cost is compliance build-out | NOT VERIFIED (no public fee schedule) |
| Annual cost | AUSTRAC industry contribution levy applies to reporting entities above thresholds | NOT VERIFIED (VASP-specific figure) |
| Timeline | Enrolment from 31 Mar 2026; registration confirmation required before providing services | Confirmed |
| Passporting | None — Australian registration is domestic; no EU-style passport | Confirmed |
| Grandfathering | Existing DCEs transition into the expanded VASP regime; transitional rules defer new-service obligations to 1 Jul 2026 | Confirmed |
| Banking access | No statutory guarantee; de-banking of crypto firms remains an industry concern (Council of Financial Regulators de-banking work) | Confirmed (concern); quantitative data NOT VERIFIED |
| Approval data | AUSTRAC enforced registration standards — nine providers suspended/refused renewal in early 2025 | Reported (secondary) |
Source:
4. ASIC Consumer Protection and Licensing
Existing Framework
ASIC regulates crypto assets that qualify as financial products under the Corporations Act 2001. A token structured as a security, derivative, or managed investment scheme interest requires the issuer/operator to hold an Australian Financial Services Licence (AFSL), issue a Product Disclosure Statement (PDS), and comply with Design and Distribution Obligations (DDO).
ASIC's Information Sheet 225 (INFO 225) provides guidance on when crypto assets are financial products. An updated version was consulted on via Consultation Paper 381 (December 2024), with final guidance expected mid-2025.
Key Enforcement Cases
| Case | Issue | Outcome |
|---|---|---|
| ASIC v Web3 Ventures (Block Earner) | Unlicensed financial services for fixed-yield crypto product | Federal Court found licence required (2024); Full Federal Court reversed (22 April 2025); High Court heard the appeal on 12 March 2026 — judgment reserved (pending as of June 2026) |
| ASIC v Finder Wallet (Finder Earn) | Alleged unlicensed debenture offering | Full Federal Court dismissed ASIC appeal; ruled crypto yield product was not a debenture |
| ASIC v Bit Trade (Kraken) | Failure to comply with DDO for margin trading product | Proceedings commenced September 2023; ongoing |
These cases highlight regulatory uncertainty around which crypto products require licensing, motivating the proposed Digital Asset Platform Bill.
Digital Assets Framework Act 2026 (enacted)
Introduced to Parliament on 26 November 2025 as the Corporations Amendment (Digital Assets Framework) Bill 2025 (building on the 25 September 2025 Treasury exposure draft for "regulating digital asset platforms"), the bill passed Parliament on 1 April 2026 and received Royal Assent on 8 April 2026, becoming the Corporations Amendment (Digital Assets Framework) Act 2026. It integrates digital asset platforms into the financial-services regime for the first time, creating two new categories of financial product under the Corporations Act 2001:
- Digital Asset Platforms (DAPs) — facilities where an operator holds digital tokens (underlying assets) for itself or on behalf of others (covers exchanges, custodians, certain token platforms).
- Tokenised Custody Platforms (TCPs) — facilities where an operator holds non-money assets and issues a single digital token per asset granting redemption/delivery rights.
Operators of DAPs and TCPs must hold (or vary an existing) AFSL and meet core obligations: act efficiently/honestly/fairly, avoid misleading conduct, provide clear disclosure, maintain governance controls, and offer dispute resolution. Small, low-risk platforms holding less than AUD 5,000 per customer and facilitating less than AUD 10 million per year in transactions are exempt.
AFSL licensing dimensions (DAP / TCP regime):
| Dimension | Requirement | Status |
|---|---|---|
| Authority | ASIC (AFSL) | Confirmed |
| Trigger | Operating a DAP or TCP above the small-platform exemption | Confirmed |
| Fixed capital | AFSL financial-requirements (e.g. net tangible assets / adjusted-surplus-liquid-assets) apply per licence authorisations; DAP/TCP-specific standards to be set by legislative instrument during the implementation roadmap | NOT VERIFIED (DAP-specific capital figure pending ASIC standards) |
| Safeguarding / custody | Client-asset custody standards to be specified in regulatory standards (legislative instruments) released months 6-12 of the roadmap | Confirmed (standards pending) |
| Application deadline | Existing firms must apply for a licence/variation (or notify intent for market/CS-facility licences) by 30 June 2026 under ASIC's class no-action position | Confirmed |
| No-action / relief | ASIC class no-action position under INFO 225 runs to 30 June 2026; DAP/TCP operators get regulatory relief while applications are processed after commencement | Confirmed |
| Commencement | 9 April 2027, with a six-month transition (existing operators may keep operating while applying) | Confirmed |
| Passporting | None | Confirmed |
| Grandfathering | Transition relief for incumbents during the six-month window; AFSL holders will need to add DAP/TCP authorisations | Confirmed |
| Penalties | Unlicensed conduct carries civil and criminal penalties, including fines up to 10% of annual turnover | Confirmed |
Sources:
- Parliament of Australia: Corporations Amendment (Digital Assets Framework) Bill 2025
- Treasury: Regulating digital asset platforms — exposure draft legislation (c2025-701519)
- ASIC: Deadline looms for digital asset businesses to apply for a licence
- ASIC: Roadmap for digital assets law reform implementation
- ASIC: Block Earner High Court Leave (25-194MR)
5. Payment System Regulation
Payments System Modernisation Act 2025
The Treasury Laws Amendment (Payments System Modernisation) Act 2025 (Royal Assent 19 September 2025) modernised the Payment Systems (Regulation) Act 1998. Key changes:
- Broadened definitions of "payment system" and "participant" to capture digital wallets, BNPL providers, and crypto asset payment facilitators
- Treasurer designation powers: Critical payment systems can be designated for enhanced scrutiny
- RBA enforcement tools: Enforceable undertakings, civil penalties, enhanced dispute resolution powers
- Public consultation planned for mid-2026 on regulatory priorities under the amended Act
This means crypto-based payment services (e.g., stablecoin payment rails) may now fall within the RBA's oversight perimeter.
CFR Regulatory Perimeter Review
The Council of Financial Regulators (CFR) -- comprising the RBA, APRA, ASIC, and Treasury -- conducts periodic reviews of the regulatory perimeter. The CFR has identified crypto assets as a priority area, examining whether existing frameworks adequately cover payment stablecoins and tokenised deposit products.
Sources:
6. Stablecoin Regulation
Australia does not yet have a dedicated stablecoin licensing regime. However, stablecoins are captured by multiple overlapping frameworks:
- AUSTRAC: Stablecoin exchange services require DCE (and from March 2026, DASP) registration
- ASIC: A stablecoin functioning as a financial product (e.g., a managed investment scheme) may require AFSL licensing and PDS issuance
- RBA: Stablecoin payment facilitators fall within the modernised Payment Systems (Regulation) Act perimeter
- Token Mapping: Treasury's 2023 consultation classified payment tokens (including stablecoins) as likely to attract financial product regulation
The Treasury Token Mapping Consultation (February 2023) proposed a functional approach to classification. Tokens performing payment or investment functions were identified as likely regulated. Treasury categorised crypto into four product types across two systems:
- Intermediated token systems: crypto asset services; intermediated crypto assets
- Public token systems: network tokens; public smart contracts
The Corporations Amendment (Digital Assets Framework) Act 2026 (Royal Assent 8 April 2026, commencing 9 April 2027) now brings digital asset platforms — including those trading stablecoins — under AFSL requirements; stablecoins are among the digital-asset financial products firms must factor into AFSL applications by the 30 June 2026 deadline.
Sources:
7. AML/KYC and Travel Rule
AML/CTF Programme Requirements
All registered DCEs (and from 2026, DASPs) must maintain an AML/CTF programme covering:
- Part A: Risk-based customer due diligence (CDD), including identity verification, beneficial ownership identification, and enhanced due diligence for high-risk customers
- Part B: Employee training, compliance officer appointment, independent reviews
- Reporting: Suspicious Matter Reports (SMRs), Threshold Transaction Reports (TTRs), International Funds Transfer Instructions (IFTIs)
Travel Rule
The AML/CTF Amendment Act 2024 formally incorporates the crypto Travel Rule into Australian law, aligned with FATF Recommendations 15 and 16. Key details:
- Scope: Both domestic and cross-border virtual asset transfers
- Originator and beneficiary information must accompany transfers
- Effective date: Originally scheduled for 31 March 2026; under AUSTRAC's transitional rules 2026 the Travel Rule for virtual asset transfers was deferred to 1 July 2026. Both existing and newly regulated VASPs must implement it from that date, with no exemption applying
- Threshold: Aligned with FATF standards
Sources:
8. Taxation
Crypto assets are treated as property for tax purposes by the Australian Taxation Office (ATO):
- Capital Gains Tax (CGT): Disposal of crypto triggers a CGT event; 50% CGT discount available for assets held over 12 months (individuals)
- Income tax: Crypto received as payment for services, mining, staking, or airdrops may be assessable income
- GST: Crypto used as payment is generally GST-free (since 1 July 2017), but the supply of goods/services for crypto attracts normal GST
- Record-keeping: ATO requires detailed records of all crypto transactions
9. Comparison with Regional Peers
| Dimension | Australia | Singapore | Hong Kong | Japan |
|---|---|---|---|---|
| Primary AML regulator | AUSTRAC | MAS | HKMA/SFC | JFSA |
| Licensing model | AUSTRAC VASP registration + enacted AFSL regime for DAPs/TCPs (commences 9 Apr 2027) | Payment Services Act licensing | VATP licence (SFC) + Stablecoin licence (HKMA) | VASP registration |
| Stablecoin-specific regime | Not yet (captured by multiple frameworks) | Stablecoin framework under MAS (2023) | Stablecoins Ordinance (August 2025) | JFSA stablecoin rules (June 2023) |
| Travel Rule | Deferred to 1 July 2026 | In force | In force | In force |
| Consumer protection | ASIC (financial products); enacted DAP/TCP AFSL regime | MAS consumer safeguards | SFC investor protection rules | JFSA user protection |
10. Key Regulatory Milestones Timeline
| Date | Milestone |
|---|---|
| April 2018 | AUSTRAC DCE registration regime commences |
| February 2023 | Treasury Token Mapping Consultation Paper released |
| December 2024 | AML/CTF Amendment Act 2024 receives Royal Assent |
| December 2024 | ASIC Consultation Paper 381 (INFO 225 update) |
| August 2025 | AUSTRAC tables AML/CTF Rules 2025 |
| September 2025 | Payments System Modernisation Act receives Royal Assent (19 Sep) |
| 25 September 2025 | Treasury releases exposure draft to regulate digital asset platforms |
| 26 November 2025 | Corporations Amendment (Digital Assets Framework) Bill 2025 introduced to Parliament |
| 12 March 2026 | High Court hears ASIC v Web3 (Block Earner) appeal; judgment reserved |
| 31 March 2026 | AUSTRAC enrolment opens for new virtual asset designated services |
| 1 April 2026 | Digital Assets Framework Bill passes Parliament |
| 8 April 2026 | Corporations Amendment (Digital Assets Framework) Act 2026 receives Royal Assent |
| 30 June 2026 | AFSL application deadline under ASIC class no-action position for digital asset firms |
| 1 July 2026 | VASP AML/CTF obligations and the Travel Rule take effect |
| 29 July 2026 | VASP registration / AML/CTF compliance-officer notification deadline |
| 9 April 2027 | Digital Assets Framework Act 2026 commences (six-month transition) |
Recent Developments
- 8 April 2026 — Digital Assets Framework Act enacted. The Corporations Amendment (Digital Assets Framework) Bill 2025 passed Parliament on 1 April 2026 and received Royal Assent on 8 April 2026, becoming the Corporations Amendment (Digital Assets Framework) Act 2026. It creates two new financial product categories — Digital Asset Platforms (DAPs) and Tokenised Custody Platforms (TCPs) — requiring an AFSL, with a small-platform exemption (<AUD 5,000/customer and <AUD 10m/year) and commencement on 9 April 2027 after a six-month transition. Source: Parliament of Australia bill page; ASIC: Deadline looms for digital asset businesses to apply for a licence.
- April 2026 — ASIC publishes digital-assets law-reform implementation roadmap confirming the AFSL application deadline of 30 June 2026 under the class no-action position and an 18-month implementation timeline to the 9 April 2027 commencement. Source: ASIC roadmap.
- 31 March 2026 — AUSTRAC VASP enrolment opened. Enrolment for new virtual asset designated services opened on 31 March 2026; substantive AML/CTF obligations (including the Travel Rule) commence 1 July 2026, with registration / compliance-officer notification due 29 July 2026. Source: AUSTRAC: Register as a remittance or virtual asset service provider (Reform); AUSTRAC transitional rules update.
- 12 March 2026 — ASIC v Web3 (Block Earner) heard by the High Court; judgment reserved. The High Court heard ASIC's appeal on 12 March 2026 on whether a fixed-yield crypto product is a financial product; judgment remains reserved as of 4 June 2026. Source: ASIC media release 25-194MR.
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Related coverage
Australia in other research domains:
- CBDC Frameworks
- Crypto Mining Regulations
- DeFi Regulation & Liability Frameworks
- Digital Asset Insurance & Risk Transfer
- Digital Asset License Map
- Digital Asset Taxation
- Institutional Crypto Custody Regulations
- NFT & Digital Collectibles Regulations
- Stablecoin Regulations & License Regimes
- Tokenized Real-World Assets (RWA) Regulation
Verification Notes
- AUSTRAC DCE registration requirements confirmed via AUSTRAC official website.
- AML/CTF Amendment Act 2024 details confirmed via Department of Home Affairs.
- Payments System Modernisation Act details confirmed via Parliament of Australia and RBA media release.
- Token Mapping consultation confirmed via Treasury.gov.au.
- Block Earner High Court proceedings confirmed via ASIC media release 25-194MR.
- Travel Rule deferral to 1 July 2026 confirmed via AUSTRAC transitional rules and AUSTRAC travel-rule reform guidance.
- Nine DCE suspensions/refusals in early 2025 reported via secondary sources (Sumsub); the specific count of nine is NOT VERIFIED against an AUSTRAC primary enforcement notice and should be treated as reported-only.
- Digital Assets Framework Act 2026 — Royal Assent 8 April 2026, commencement 9 April 2027 — confirmed via Parliament of Australia bill page and ASIC licence-deadline notice.
Corrections made in this refresh (2026-06-04)
- Digital Asset Platform Bill status (CORRECTED). Prior version described it as a proposed "Digital Asset Platform Bill" (introduced 26 Nov 2025). It is now the enacted Corporations Amendment (Digital Assets Framework) Act 2026 (passed 1 April 2026, Royal Assent 8 April 2026, commencing 9 April 2027). Updated frontmatter, intro, Sections 2/4/6/9 and the timeline; added DAP/TCP categories and the AUD 5,000/AUD 10m small-platform exemption.
- VASP/DASP commencement dates (CORRECTED). Prior version stated "DASP obligations from 31 March 2026" and "local compliance officer mandatory from March 2026". Per AUSTRAC's transitional rules, 31 March 2026 is when enrolment opens; substantive AML/CTF obligations (including the Travel Rule) commence 1 July 2026, and registration / compliance-officer notification is due 29 July 2026. Corrected in the intro and Section 3 with a phased-commencement table.
- Block Earner High Court (UPDATED). Prior version stated "High Court hearing 12 March 2026" (forward-looking). The hearing was held on 12 March 2026 and judgment is reserved (pending as of 4 June 2026). Updated Section 4, the timeline, and Recent Developments.
- ASIC no-action position (CLARIFIED). Refined to note the 30 June 2026 date is the AFSL application deadline under ASIC's class no-action position (per ASIC's implementation roadmap), not merely a generic "no-action expiry".
- Licensing depth (DEEPENED). Added dimension tables for both the AUSTRAC VASP registration and the DAP/TCP AFSL regime (authority, capital, safeguarding, timeline, passporting, grandfathering, banking access, penalties), marking non-public items NOT VERIFIED.