Will Australia’s mindful regulations allow Bitcoin to thrive?

Sahana Kiran
Source – Unsplash

Crypto regulations have become more than pertinent right now. With adoption at full spree, governments across the globe are forced to make it a safe space for the public. While certain governments have outrightly dismissed crypto, a few others have been slowly and carefully embracing it. Australia has been making the news lately in the crypto-verse for its Bitcoin-friendly approach. More recently, the ministerial department of the Treasury urged Australians to come forward and share their opinion with regard to a crypto-related matter.

Back in June 2022, Assistant Treasurer Stephen Jones noted how the Australian government would not consider cryptocurrencies to be touted as foreign currency for tax purposes. But now, the department seemed to be seeking the public’s opinion about the same. Starting today, Australians have a period of 25 days till the 30th of September to give in their opinion about the legislation proposed by the department.

If passed, the proposal will modify the Goods and Services Tax [GST] Act’s perspective about Bitcoin, essentially eliminating cryptocurrency assets from the definition of foreign currency. In Australia, GST includes tax imposed on goods, services as well as objects bought, sold, or employed in the region.

While this is at play, it should be noted that the legislation would not tamper with capital gains taxes on crypto investments.

This move comes to tackle El Salvador’s decision in adopting Bitcoin as a legal tender. The government intends to rule out uncertainties surrounding crypto taxation.

Australia and its cautious approach toward crypto

As mentioned earlier the entire globe has been on a crypto adoption spree. Several countries have even adopted Bitcoin as a legal tender. A few others like the Indian government created an uncertain environment for crypto to exist in the country. Amidst all of this, Australia seemed to be moving swiftly yet cautiously.

Just yesterday, the Australian Federal Police announced the creation of a unit specifically for crypto. About two weeks ago, the Australian treasury declared that it intends to roll out a crypto regulatory framework that would be thorough and well informed, and even better than those formulated by other governments.

Regulations and adoption go hand in hand. Limited regulatory clarity makes it hard for Bitcoin to thrive. Therefore, the community believes that Australia’s approach toward Bitcoin could spruce up the industry’s adoption.