Australian Liberal Senator Andrew Bragg kicked off the Australian Blockchain Week conference with an explosive legislative proposal that he hopes will lay the groundwork for a new Digital Assets ecosystem.
The proposed legislative package for the Digital Services Act (DSA) requires reforms in crypto market licenses, custody, decentralized autonomous organizations (DAO), debanking and taxes. Senator Bragg said in his speech at the conference that he hopes the Act's legislation will "protect (crypto) consumers from malicious operators."
Senator Bragg outlined the four main pillars that the DSA is guided by. He explained that the DSA would be technologically neutral, have broad and flexible principles, be regulated by a Minister rather than a bureaucratic agency, and use government resources and personnel. In his opinion, such guidance will help Australia show that the country is ready to take on a bigger role in the crypto industry.
"This will show that Australia is open for business and things are clear and clean."
The Senator also took on DAOs, challenging various branches of government to take them seriously. He went so far as to call them "an existential threat to the tax base" under current rules.
According to data published by the Parliament in Australia, corporate income tax represents the second largest source of revenue for the government after income tax; however, DAOs are not taxed like corporations.
To that, Senator Bragg said that his country's โreliance on corporate tax is unsustainableโ if an increasing number of organizations become DAOs. As a result, the DSA would task the government with creating a framework for creating standards for DAOs without stifling its basic principles.
Essentially, the rules would ensure that consumers have access to DAO auditing, assurance and disclosure services that help them distinguish between retail and wholesale organizations. Senator Bragg called on Treasury to address those issues while "leaving the field open for the DAO to continue to live up to its name."
Based on the ambitions of the Australian crypto center: address for @BlockchainAUS.https://t.co/j79BpbGJKI pic.twitter.com/8bf7Sqjut4
โ Senator Andrew Bragg (@ajamesbragg) March 20, 2022
Head of corporate development at Australian crypto exchange Swyftx Michael Harris is in favor of the government setting higher standards for the national crypto industry. He told Cointelegraph today that exchanges have nothing to fear from higher standards because โmost Australian exchanges already take their duty of care to customers very seriously.โ
Related: Australian Fintech to Offer Widespread Direct Access to DeFi with a Flat Fee
Harris added that the land below should lead the developed world in crypto regulation due to its high adoption rate. A pollster poll Discoverer found that 22.9% of Australians held crypto between October and December 2021. Harris went on to state that:
โWe see this as an important step forward. Australia has one of the highest cryptocurrency adoption rates in the developed world. It makes a lot of sense for us to lead the regulation.โ
One of the main concerns in the crypto market lately is its use by individuals and nations to circumvent global economic sanctions. there is currently a Furious debate in the US Senate on whether the Russian government can keep its military operation in Ukraine financed with the help of cryptocurrency.
Blockchain tracking firm Elliptic discovered on March 15 that some sanctioned people have crypto, but Senator Bragg stated that the Australian government had no power under current digital currency exchange (DCE) laws to punish such violators. The DCE's lack of jurisdiction served as the motivation for making the new proposals to prevent sanctioned individuals from taking advantage of lax crypto laws, and he added:
โThe reality is that we do not live in a libertarian nirvana. We cannot have regulatory arbitrage.โ
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