Australia is committed to raising security and consumer protection standards in the crypto space. The government recognizes that blockchain technology has the potential to change many aspects of the current financial system. As part of its support and adoption of progressive approaches to exchange control, AUSTRAC's powers were strengthened through legislation passed in December 2017
New obligations for cryptocurrency exchanges will start on April 3:
⁃ adoption and implementation of the KYC & AML program to identify, mitigate and manage the risks of money laundering and terrorist financing
⁃ identification and verification of identity customers
⁃ reporting to AUSTRAC on suspicious transactions and transactions with physical currency exceeding AUD 10,000 (USD 7,700)
⁃ maintaining transaction and customer records for seven years.
Crypto platforms operating in Australia will now have to prove their compliance with the updated laws.
Australian operators are required to register with the newly created Digital Currency Register by 14 May this year. AUSTRAC is establishing a transitional registration procedure to allow crypto market participants to remain in business until the registration process is complete. Unregistered illegal activity is considered a crime and is subject to criminal penalties or fines.
In July 2018, the problem of double taxation when paying with cryptocurrency will also be resolved. The 2014 law treated cryptocurrency as a commodity. This made Australians pay tax when using digital currency. (GST, analogue of VAT). In the summer, this rule will be abolished, and digital currencies will be classified as foreign currency when calculating GST.
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