Bragg calls for fast-tracked crypto reforms, warning of collapses to come

Senator Andrew Bragg has called for a fast tracking of reforms to crypto regulation, saying we could see more businesses leaving Australia for friendlier shores, or collapsing entirely.

Speaking at the APAC Blockchain conference yesterday, Bragg pointed to the collapse of Australian cryptocurrency exchange MyCryptoWallet, and the associated losses for customers.

He also noted that businesses such as MHC Digital Code are moving overseas to more crypto-friendly locations.

These are “big blows” to the Australian economy, and examples of why we need regulation in the sector.

“If we do not act, and act fast, it is only a matter of time until these events are repeated,” Bragg said.

Bragg is currently overseeing a senate inquiry into reform of cryptocurrency regulation in Australia, which in October last year tabled a suite of reforms.

Leaders of Australia-based crypto businesses have previously pointed to a lack of regulation as something inhibiting the growth of the sector here.

For example, Caroline Bowler, chief executive of cryptocurrency exchange BTC Markets told SmartCompany there have been things she and her team have wanted to implement, but haven’t been able to because the regulatory framework simply didn’t allow for it.

That said, Bragg noted the importance of well-designed regulation, to support businesses like BTC Markets, rather than stifle them.

Australian tech entrepreneurs are doing “extraordinary things”, he said.

“They shouldn’t be choked by cumbersome, ill-designed, and inappropriate regulations. But there must be some form of regulation as set out in our policy.”

Addressing an “urgent need” in Aussie crypto

Bragg’ comments came just a day after Telstra chief executive Andrew Penn — who is also Chair of the Federal Government’s Industry Advisory Committee (IAC) on cybersecurity — called for greater education and regulation around cryptocurrency in Australia.

Regulation in particular would both foster innovation and provide better oversight of the industry, he said.

He also suggested that cryptocurrencies are more vulnerable to “scams, confidence tricks and online ‘rug pulls’, which could easily see Australians lose their investments”.

With more Australians using cryptocurrencies, there is an “urgent need” for more consumer education, and for regulated minimum cybersecurity standards for crypto businesses.

“From consumers better educating and protecting themselves against scams, to crypto businesses taking stronger cyber security action, right through to government and policy settings that strike the right balance between innovation, protection and oversight, Australians can and should be able to embrace the digital economy and access the benefits offered by cryptocurrencies with confidence,” Penn said.

A crypto “fork in the road”

In his own speech, Bragg cited a report from EY that found the crypto sector has contributed $2.1 billion to the Australian economy, and employs more than 11,000 people.

The policies he is drawing up could increase that economic contribution to $68.4 billion by 2030, and lead to the employment of more than 200,000 people, he said.

If we don’t implement reforms quickly, however, “Australia runs a very serious risk of falling behind”.

“We are at a fork in the road,” he added.

“Down one path, we can see money, talent, and revenue leak offshore as we scramble to follow the world. This is also the path of no consumer protection.

“Down the second path, we have the opportunity not just to join this group, but to lead it.”