Australia has set out to lay guidelines and risk management for all entities that are engaging in crypto-associated activities.
The Australian Prudential Regulation Authority (APRA) deployed a set of initial risk management expectations and a policy roadmap. The expectations have been laid out for the entities involved in activities associated with cryptocurrency assets.
The roadmap will include the standards laid down for the next three years.
Australia envisions scaling up crypto activities
The announcement is quoted from a letter called the Crypto-assets risk management expectations and policy roadmap by APRA Chair Wayne Byres. APRA is the authority that supervises banking, pension institutions, and insurance in Australia.
The authority stressed the importance of dealing with crypto assets cautiously with proper risk assessments. They stressed that it would be difficult for the authorities to identify and manage the risks without appropriate guidelines.
The new strategic initiative involves a roadmap till 2025 where they plan to implement operational risk standards by 2024 and value facility standards by 2025. APRA also mentioned that it would be emphasizing possible approaches to regulate stablecoins, among others.
Crypto is flourishing
According to the Australian Taxation Office, more than 800,000 Australians have transacted in digital assets in the past three years showing the scaling popularity of crypto in the country.
The need for regulatory decisions comes with the rising crypto adoption in the country, which displayed a 63% increase in the year 2021.
The crypto policy roadmap being laid out by APRA is in consultation with the international regulators. This is to ensure that there is a consistent approach between the nations.
The risks and relevant standards released under the APRA regulations include activities like investments in crypto assets, lending activities linked with crypto assets, crypto assets issuance, services for the customers, and partnering with other companies.
The country has also welcomed blockchain technology as four major banks started issuing digital bank guarantees and adopted distributed ledger technology. The outlook is evident that the authorities and the government are collaborating to mitigate the risks and provide a much better and safe crypto experience.