Australian fintech committee has crypto in its sights

The Senate Select Committee on Australia as a Technology and Financial Centre has started its third and final phase of probing the fintech scene, this time narrowing in on nascent tech such as cryptocurrency and blockchain.

The Senate committee looking into the possibilities of financial and regulatory technology in Australia has recommenced its inquiry, changing its name, too.

The Senate Select Committee on Australia as a Technology and Financial Centre, formerly the Senate Select Committee on Financial Technology and Regulatory Technology, on Wednesday released an issues paper to guide the final phase of its inquiry that first kicked off in October 2019.

In the last phase of its inquiry, the committee will focus on removing more barriers to Australian growth as a technology and finance centre.

"The work of the committee to date has shown that Australia is well placed for growth in the financial and technology sectors and to attract investment and create jobs," the committee said.

The committee tabled its first report in September 2020, making 32 recommendations that committee chair, Senator Andrew Bragg, labelled a "series of quick wins".

They covered research and development (R&D), backing startups, the Consumer Data Right, digital identity, and blockchain, among others.

It then kicked off round two, with a focus on a post-COVID Australia. A report was released in April that made a total of 23 recommendations that either built on, or superseded, the 32 it made in September.

Among the recommendations it made were changes to Australia's R&D laws, such as the establishment of a separate software-specific tax incentive scheme.

Round three, the issues paper says, will see further focus placed on the size and scope of the opportunity for Australian consumers and business to grow into a stronger technology and finance centre.

The committee wants to investigate the flow-on employment and economic benefits which accrue to finance and technology centres; barriers to the uptake of new technologies in the financial sector; and the new opportunities for Australia as a technology and finance centre arising from the COVID-19 pandemic.

It is also interested in benchmarking Australia against comparable global regimes, probing the impact of corporate law restraining new investment in Australia, as well as the policy environment facing neo-banks, and, of course, the opportunities and risks in the digital asset and cryptocurrency sector.

"The committee is interested in the economic opportunities posed by blockchain technology and digital asset technology in particular. Thus far, the committee has heard blockchain has applications across sectors and industries. The committee will be looking at policies for enhancing these opportunities to promote Australian investment and jobs," it wrote.

"We want to know what type of policy provision and legal certainty is needed to drive private investment into Australian digital assets rather than the investment occurring offshore."

In particular, the committee will be assessing options for the development of a comprehensive regulatory framework for cryptocurrency and digital assets. Existing regulatory schemes, such as those in comparable jurisdictions, will be examined. 

It hopes to gain a better understanding of the relative sophistication of the policy and legal landscape in Australia compared to similar jurisdictions, noting it was particularly interested in the approaches taken by policymakers in Canada, Singapore, the United Kingdom, and the European Union.  

The committee said it is interested in how Australia can market its strengths to position itself globally as a technology and finance centre. It is accepting submissions until 30 June 2021.

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