Blockchain and cryptocurrency technologies should not be treated as a separate asset class when crafting regulations, according to Rhys Bollen, the fintech head at the Australian Securities and Investments Commission (ASIC).
Speaking at the Melbourne Money & Finance Conference, Bollen argued that crypto assets largely perform the same financial roles as traditional instruments and should therefore be regulated based on their economic function rather than the technology behind them.
When History Rhymes: Regulating Digital Assets: Paper Presented At The Melbourne Money & Finance Conference, University Of Melbourne, By Dr Rhys Bollen, Senior Executive Leader, FinTech https://t.co/RtVKnfL3nI
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Australia pushes function-based approach to crypto regulation
In his view, blockchain-based assets are simply a new technological format for long-standing financial activities such as payments, capital allocation, and risk management. While blockchain changes how assets are issued, transferred, and recorded, it does not alter the underlying economic purpose.
Bollen explained that regulators should focus on the real-world financial role an asset plays. For instance, tokenized securities should fall under securities laws, while stablecoins used for transactions should be regulated through payment services legislation.
According to Bollen, financial systems have repeatedly adapted to technological change without abandoning core regulatory principles such as consumer protection, market integrity, and financial stability.
Australia integrates crypto into existing financial laws
Australia has already begun applying this principle through its proposed Digital Asset Framework Bill, which is designed to amend existing financial legislation rather than introduce an entirely new crypto-specific law.
Bollen noted that the bill works within the framework of the Corporations Act 2001, adding targeted amendments that bring digital asset platforms into the country’s established regulatory system.
Guidance from ASIC’s ASIC Information Sheet 225 also reflects this approach. The document clarifies that digital assets can already fall within existing legal definitions of financial products or services if they operate as securities, derivatives, managed investment schemes, or payment instruments.
Under the updated guidance, stablecoin issuers will generally need a license because such tokens are often classified as non-cash payment facilities or managed investment schemes. ASIC has also proposed transitional relief for some stablecoin and wrapped token distributors to help them adapt to upcoming legal reforms.
Bollen added that most risks in the digital asset sector stem from intermediaries like trading platforms, custodians, and lending services rather than the tokens themselves.
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