In the wake of COVID-19’s economic damage unsettling the global economy and crashing three major banking institutions, the Australian Banking Association (ABA) is taking proactive steps towards easing the cost of living in Australia. With the ongoing inflationary pressure, rising property rent and various other issues, ABA has launched a cost of living inquiry to identify ways to alleviate the cost of living.
More than that, the Reserve Bank of Australia (RBA) and the Department of the Treasury have embarked on a path to explore the possibilities of crypto regulations in the nation. From a central bank perspective, increased engagement with the crypto ecosystem is seen as a means to protect the financial stability from the disjuncture between the traditional fiat-driven economy and the new-age crypto-oriented economy.
On the crypto front, the RBA and the Treasury have held private meetings with several executives from San Francisco-based cryptocurrency exchange, Coinbase. It was revealed that these private meetings were held to understand their views and further develop the regulatory framework for the crypto sector. This consultation was carried out by the Treasury and was signed off as a token mapping consultation paper. Submissions were expected from both the crypto-industry and other stakeholders. Tom Duff Gordon, Coinbase’s Vice President of International Policy, highlighted the importance of transparency by stating “The Australian Treasury’s token mapping exercise is one of the most detailed and thoughtful papers we have seen on the topic, and it sets a strong foundation for their forthcoming draft rules for crypto exchanges and custodians.”
Conversely, Coinbase’s CEO Brian Armstrong found the regulations in the US to be wanting and criticized their approach on “regulating by enforcement”. When asked about the progress of the regulations from the Australian government, Gordon looked to secure the regulations by the end of the year, as the comprehensive groundwork has already been laid.
Coinbase’s Australian venture began in October 2022 and Nana Murugesan, Coinbase Vice President of International and Business Development, voiced a positive opinion on the open door nature of the policy makers in Canberra. Moreover, the documents received by the Australian Financial Review suggested that the registrations could keep taking place until 2024 and beyond
All this speaks to the fact that the Reserve Bank of Australia, together with the Treasury, are steadily making progress on the blockchain front. The cost of living inquiry headed by the ABA promises to improve the living conditions for Australians, while the token mapping consultation paper earmarked for the crypto sector attempts to bridge the divide between the traditional fiat-driven economy and the alternative blockchain-based economy.
In the near future, Australia looks to bring regulation to the larger crypto industry which will better safeguard citizens from potential risks. In the meantime, citizens are encouraged to be proactive and ensure they are getting the best deal for their banking services. For those in financial difficulty, banks offer assistance of waivers, emergency credit limit increases and deferred loan repayments–creating the perfect environment for individuals to stabilize the economic strain of 2021 and beyond.