Australia passes its first “cryptocurrency regulatory law”! Exchanges and custodians are included in the financial services licensing regime

Australia officially passed legislation on April 1, establishing the country’s first digital asset regulatory framework, requiring that all cryptocurrency exchanges and custody service providers must obtain a financial services license within six months in order to operate legally. The landmark bill, titled the 《2025 Companies Amendment Act (Digital Asset Framework)》, successfully cleared both houses of Australia’s parliament on April 1, officially bringing all providers that “hold digital assets on behalf of clients” under Australia’s existing financial services licensing regime.

According to the bill’s provisions, the Companies Act adds two categories of regulated entities: first, “digital asset platforms” that hold cryptocurrency on behalf of users; second, “tokenized custody platforms” that hold real-world assets (RWA) and issue corresponding digital tokens. Both types of providers must apply to the Australian Securities and Investments Commission (ASIC) for a financial services license, subject to the same rules as broker-dealers and fund managers, including proper custody of client assets, providing standardized information disclosures, and prohibiting any conduct that could mislead investors, while also needing to establish a comprehensive dispute resolution and investor compensation mechanism. Worth noting is that this law does not directly regulate cryptocurrencies themselves, but instead targets the intermediaries that manage client funds, aiming to reduce risks commonly seen in past cryptocurrency platform insolvency incidents, such as the mixing of customer assets and company funds, platform liabilities exceeding assets, and the misuse of client assets. According to research by the Australian Centre for Digital Financial Cooperation and industry organizations, with robust regulations in place, Australia is expected to generate up to 24 billion Australian dollars in annual output in the tokenization market, payments, and the digital asset sector, accounting for about 1% of GDP. If estimates based on the previous regulatory path are applied, by 2030 it would only be able to generate about 1 billion Australian dollars in revenue.