Australian Government to Review Bitcoin Regulation Powers

The Australian government has committed to reviewing how the country's central bank and top securities regulator oversee bitcoin and other emerging payment systems.

Earlier today the Australian government released its response to the Murray Review, otherwise known as the Financial System Inquiry, a wide-ranging report published last December as part of an effort by the government to make changes to the country's financial system.

The Murray Review's name is derived from the committee chairman of the panel that drafted it, David Murray, who acted as chief executive of Commonwealth Bank of Australia between 1992 and 2005. According to the report's introduction, the effort was aimed at "examining how the financial system could be positioned to best meet Australia’s evolving needs and support Australia’s economic growth".

As part of a range of policy commitments related to innovation in the financial system, the government said in its response that it would look at the regulatory capacities of both the Reserve Bank of Australia (RBA) and the Australian Securities and Investments Commission (ASIC) in an effort to create a "graduated" rulemaking process for emerging payments systems, including bitcoin.

The government said:

"We will clarify powers held by ASIC and the RBA to ensure that regulators have the power to regulate new payment systems in a graduated way, such as digital currencies (e.g. bitcoin) and other payment systems as they emerge."

Though it's the only part of the report that explicitly mentions bitcoin or digital currencies, other measures set to be taken could impact the country's bitcoin ecosystem. These include the creation of a public-private sector "collaborative committee" aimed at strengthening engagement between government regulators and startups and a broad commitment to keep national legislation "technology neutral".

"Technology-specific regulation can impede innovation and competition by preventing the adoption of the best technology or the most innovative business models," the government said, going on to state that it would "consult with the financial sector on priority areas of existing legislation and regulation" as it looks to draft new proposals.

The policy response comes amid a crackdown on bitcoin businesses by some of Australia's largest banks. An investigation by the Australian Competition and Consumer Commission (ACCC) into the closure of startup bank accounts is currently underway.

The Australian Treasury did not immediately respond to a request for comment.

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