It was indicated by Australia’s ASIC that the regulatory relief could be extended to more issuers as additional stablecoins are granted AFS licences.
Regulatory relief has been granted to stablecoin intermediaries by the Australian Securities and Investments Commission, exempting them from needing separate financial services licences when distributing crypto that is issued by licensed Australian providers. One expert has called the regulator “pragmatic.”
An unprecedented class relief was announced Thursday, which allows intermediaries to distribute stablecoins from licensed Australian Financial Services issuers without needing separate AFS, market, or clearing facility licences.
An important step to facilitate growth and innovation in the digital assets and payments sectors was announced today by ASIC, the regulator, in its statement.
The relief, which is effective once it is codified in federal legislation, is regarded as Australia’s first major step to address the regulatory uncertainty that has plagued the stablecoin market.
A statement was made to by Steve Vallas, CEO of Blockchain APAC, that the approach “fits within financial services law as a temporary transitional measure ahead of broader stablecoin reforms.”
It was also noted by him that “The relief doesn’t change whether some stablecoins are financial products,” but rather “suspends secondary licensing layers for distributors where the issuer already holds an AFS licence.”
It was signaled in ASIC’s December consultation on digital assets guidance that some stablecoin issuers require licensing under current definitions, a situation that created compliance complexity for intermediaries.
This issue is addressed by Thursday’s relief, which allows distribution through licensed pathways while issuer responsibilities are being maintained.
It was explained by Vallas that “The market is moving and ASIC is being pragmatic.” This decision helps bridge regulatory friction while the proposed stablecoin regime is being finalized by the Treasury.
Transparency is ensured by the exemption, which mandates that licensed issuers’ product disclosure statements are made available to clients by intermediaries.
Driven by Market Demand
It was noted by Vallas that the relief “doesn’t shift liability,” as “issuers remain responsible for disclosure and prudential obligations.”
It was explained by Vallas that “The market is moving and ASIC is being pragmatic.” He added that this decision helps bridge regulatory friction while the proposed stablecoin regime is being finalized by the Treasury.
Vallas Questions Market Demand: “Does Australia Need an Australian Dollar Stablecoin?”
Regarding market demand and competitive implications, it was stated by Vallas: “The key question is whether the market wants or needs an Australian dollar stablecoin.”
It was added by him that “Success will be ‘demand-led,’” and clues will be provided by the interest shown by global players in fulfilling Australian regulatory requirements directly or through partnerships.
It was also indicated by ASIC that relief for additional licensed stablecoin issuers will be considered as they emerge, suggesting that the framework could be expanded considerably as Australia’s digital asset sector matures.
This development coincides with the finalization by ASIC of updates to its digital assets guidance (INFO 225), which are expected to be published in the coming weeks, along with a summary of key themes and public submissions that were received in response to its December consultation.
A close collaboration is also underway between ASIC and the Treasury, as per the statement, in the implementation of the government’s digital assets reforms, which include a framework for payment stablecoins that was consulted on in 2023.
