Australia's government has announced plans to introduce a new regulatory framework for cryptocurrency exchanges, custody services, and brokerage firms.

The proposed rules will bring these platforms under existing financial services laws, requiring them to obtain licences and meet capital requirements. However, smaller firms and software developers will be exempt from these obligations.

The reforms, outlined by the Treasury, come as Prime Minister Anthony Albanese's centre-left Labour government prepares for a closely contested federal election.

The government has also pledged to collaborate with the country's four largest banks to address the ongoing issue of debanking, a problem that has impacted many crypto-related businesses.

In addition to regulatory changes, the government will review the potential for a central bank digital currency and introduce an Enhanced Regulatory Sandbox in 2025, allowing financial firms to test new products without a licence.

However, with elections looming, the opposition Coalition, led by Peter Dutton, has also promised to prioritise crypto regulation if it wins power.

Industry leaders, including BTC Markets CEO Caroline Bowler and Kraken Australia's managing director Jonathon Miller, have welcomed the government's efforts but stress the need for clarity on capital and custody requirements.

They argue that clear regulations will help Australia remain competitive while preventing unnecessary business burdens.

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