In the wake of the worldwide crypto industry regulatory push, the Australian Treasury has published a public consultation on the taxonomy of crypto assets. The four main product categories relating to the cryptocurrency industry are proposed to be separated by national regulators.
The Treasury released a consultation document on token mapping on February 3, which marks the first stage of the government’s multi-stage reform program aimed at regulating the market.
The consultation document aims to guide the creation of policies in a fact-based, customer-focused, and innovation-friendly manner. The paper outlined fundamental concepts for anything crypto based on a functional and technology-neutral approach.
The first section introduces the fundamental concepts of crypto networks, crypto coins, and smart contracts. The Treasury envisions a crypto network as a distributed computer system that can store crypto tokens, with the main tasks of information storage and user command processing. The two most well-known public crypto networks mentioned in the paper are Bitcoin and Ethereum.
The study classifies four categories of items related to crypto, including:
- Services related to digital assets, such as lending and borrowing, cash on/off ramping, digital currency trading, fund management, mining and staking as a service, gaming, and custody.
- Different levels of smart contracts, from intermediated to public, with the former used by intermediaries to provide a service and the latter utilized by parties to eliminate the need for intermediaries.
- Intermediated cryptocurrency assets, rights or licenses pertaining to event subscriptions, intellectual property, reward programs, consumer goods and services, fiat currency, non-financial assets, and government bond coupons.
- Network tokens, which are a new currency used for peer-to-peer (P2P) payment infrastructure.
The paper only serves to start the conversation on these categories and makes no legislative recommendations. The Treasury will not come to a decision until March 3.
A similar report outlining a potential licensing and custody structure for cryptocurrencies will be published in mid-2023, marking the next significant step in the national regulatory discussion.
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