Authors: Michael Bacina, Barbara Vrettos, Jade McGlynn and Luke Misthos
The Senator for Blockchain?
Senator Andrew Bragg, a highly anticipated speaker at the recent NFT Fest, has once again sent a strong message of support for the regulation of digital assets in Australia. In opening the event, Sen. Bragg addressed his hopes of positioning Australia as a 'crypto hub' with robust policy guided by three key objectives: consumer protection, investor promotion and market competition.
Bragg explained the reasoning behind the extended timeframe for the Select Committee on Australia as a Technology and Financial Centre (Committee), namely that more time was needed to accurately:-
- Assess the opportunities and threats under digital assets constituting an 'unique form of property right'; and
- Understand how digital assets could fall under a more clear, contiguous and flexible policy framework.
After examining almost 100 submissions, chairing three public hearings and holding 6 months of inquiries in the midst of many global developments, Sen. Bragg said:
While [the] window is closing every day, I do still believe Australia can be one of the biggest players in the game
The policy, which will be set out in a plan provided by the end of October, will look to strike:
a balance between bringing digital assets into the regulated world while preserving their dynamism
Sen. Bragg detailed how eyes were being cast overseas to model an appropriate regulatory framework to capture the potential for the sector. Specifically, Singapore is a standout and Australia will be aiming for a framework "at least as good as Singapore." In quick succession, Bragg indicated that he would recommend a licensing regime for consumer protection in relation to digital asset exchanges and that comparing Singapore and the UK to Australia's AUSTRAC lightweight registration process there is a clear need to "ramp up and repurpose regulation to combat the very low threshold" to the entry of bad actors, a reference to the fact that AUSTRAC registration does not involve any qualitative assessment of the strength of a digital currency exchange registering, but which is often touted by exchanges as an indication of strength or endorsement.
In closing, Sen. Bragg also highlighted that this pursuit was not to be done at the expense of environmental goals. The Senator recently commented that "excluding any part of the economy from our next zero ambitions is a bad & lazy idea" and the digital asset industry should be no exception.
The extent of the Committee’s recommendations will be unveiled when the Report is released on 30 October 2021.
Australian Digital Currency Exchanges take flight with overseas licensing!
Two of Australia's largest cryptocurrency exchanges have been granted regulatory licences overseas. Independent Reserve was approved by the Monetary Authority of Singapore (MAS) for a major payment institution licence while CoinJar received registration from the United Kingdom's Financial Conduct Authority (FCA).
Independent Reserve becomes the first and only Australian virtual asset service provider (VASP) with a Singapore licence following in-principle approval in August. Since being established in 2013, Independent Reserve has amassed over 200,000 customers and sought expansion to Singapore in early 2020. The Australian company was granted the approval over 170 other global exchanges.
CoinJar, also established in 2013, is Australia's longest running crypto exchange and relocated to the United Kingdom in 2014. The move proved worthwhile as the U.K. continues to progress regulation surrounding digital assets and awarded CoinJar an exchange registration with the FCA. This marks a successful few months for the exchange, having announced a partnership with Mastercard in August.
Currently in Australia, the only requirement to operate a crypto exchange is to be registered and enrolled as a digital currency exchange with AUSTRAC. The Select Committee on Australia as a Technology and Financial Centre is expected to shortly recommend the introduction of a licensing regime in Australia which will be aiming to be "at least as good as" Singapore's regime.
A careful balance will need to be struck between regulation and the imposition of oversight to protect consumers and the freedom necessary to promote innovation and competition, and attract businesses and talent to help Australia to continue to punch above our weight in blockchain.
Australian universities dominate ranks in global blockchain stakes
Australian universities traditionally punch above their weight globally in a number areas and blockchain is no exception. What is exceptional is just how many Aussie universities have featured in CoinDesk's annual ranking of 230 universities, taking out 10% of the top 50.
CoinDesk partnered with Stanford University to survey 230 schools worldwide for the ranking. The methodology considered courses offered, research output, campus blockchain offerings (like student clubs and research centres), employment outcomes, academic reputation and tuition cost.
Australia dominated the top 50, with Melbourne's RMIT taking out the number 2 spot globally. Hot on their heels was UNSW, just outside the top ten at 13, Sydney University came in at 20, University of Melbourne at 34, Monash 48 (just beating Harvard which scraped in at 49).
You can view the full top ten here.
The universities awarded the highest ranks are those conducting not only blockchain research, but are using their blockchain expertise to pioneer change in the real world.
The top 3 universities were:-
- National University of Singapore - which takes their research into the real world, creating real systems, business, and spin-offs which benefit from blockchain in the areas of security and privacy, consensus and execution, data storage and more;
- RMIT - home to the RMIT Blockchain Innovation Hub - the world’s first research centre on the social science of blockchain - providing a unique way to understand the global blockchain (r)evolution. RMIT has launched a $44.6m Victorian Government funded Digital CBD project to use their expertise in blockchain, digital finance and the digital economy to help the State of Victoria respond to the significant impact of the COVID-19 pandemic; and
- UC Berkeley - offering a well rounded range of blockchain courses for students as well as consultation services to companies and industries who are interested in working with blockchain experts trained and/or hired by the university to provide blockchain solutions to their existing business problems. Being in the heart of Silicon Valley doesn't hurt either.
Universities are highly competitive in their research generally, and blockchain is no exception. The public recognition of leading institutions should further fuel higher education to lean into more blockchain research opportunities.
Per CoinDesk:
Data is good. There is an absence of data on this space: Research and teaching can only get better if we track what academic institutions are offering.
Commenting on RMIT's success, Blockchain Innovation Hub Director at RMIT, Prof. Jason Potts said:
There is strong competition in the blockchain technology space in higher education. Our second placed ranking solidifies RMIT’s position as not only a world leading research centre but also as the top choice for students to come and study [the blockchain evolution].
Regulation is yet to catch up with the pace of blockchain technology. Having so many leading academics and universities focusing on blockchain should help better position Australia and our regulators to protect both consumers and innovators and catch up with other countries who are leading the ongoing blockchain (r)evolution.
Authors’ contact details
Michael Bacina - Partner, Piper Alderman
Barbara Vrettos – Lawyer, Piper Alderman
Jade McGlynn – Lawyer, Piper Alderman
Luke Misthos – Law Graduate, Piper Alderman
