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Australian Treasurer Josh Frydenberg Reveals Changes to Bitcoin, Cryptocurrency, Buy Now, Pay Later

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Australians who buy cryptocurrencies and buy now, use pay later services like Afterpay, will have stronger consumer protections from next year under the world’s first changes in alternative finance.

Due to a general distrust of banks, more than 800,000 Australian investors have poured their money into crypto, including Bitcoin, over the past three years and platforms such as Afterpay and Zip Money are growing in popularity.

Treasurer Josh Frydenberg on Wednesday unveiled the most extensive changes to the Australian payment system since the mid-1990s, with new rules for modern services.

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Australians who buy cryptocurrencies will receive consumer protections from next year under the first changes to alternative financing. Distrust of the banks has led Australians to embrace digital currencies, including the popular Bitcoin, but the system is unregulated, leaving many investors without protection if they get scammed

“We’re modernizing the payment system, we’re broadening the definition of the services and the products that can be regulated,” he told Seven’s Sunrise program.

“We’re taking this area out of the shadows and into a well-considered regulatory framework.”

  • Cryptocurrency Trading Platforms Get Government Licensed
  • A central bank digital currency will also be created
  • Buy now, pay later Apps are regulated for the first time

Treasury will begin building a digital currency exchange licensing system in early 2022.

Bureaucrats in Canberra will also explore the idea of ​​a central bank digital currency, with recommendations by the end of next year.

Afterpay charges no interest and allows consumers to pay off goods in four equal installments, but they risk hefty penalties for late payments ranging from $10 per order from $40 to $68 for value orders of over $40. Treasury has signaled new rules regarding fees and allowing other players to enter the market (Pictured is Afterpay co-founder Nick Molnar with wife Gabrielle)

Afterpay charges no interest and allows consumers to pay off goods in four equal installments, but they risk hefty penalties for late payments ranging from $10 per order from $40 to $68 for value orders of over $40. Treasury has signaled new rules regarding fees and allowing other players to enter the market (Pictured is Afterpay co-founder Nick Molnar with wife Gabrielle)

Afterpay charges no interest and allows consumers to pay off goods in four equal installments, but they risk hefty penalties for late payments ranging from $10 per order from $40 to $68 for value orders over $40.

Treasury has highlighted new reimbursement rules and allowed other players into the market.

“When it comes to new services such as buy now, pay later and digital wallets, the reforms will benefit both consumers and businesses from better regulatory oversight of fees, transparency and competition in the marketplace,” a summary said.

The new regulations came into effect just five weeks after a Senate financial technology committee recommended a digital currency exchange licensing system and a central bank digital currency.

Data from the Reserve Bank of Australia shows that as of June 30 this year, there were more than five million active buying and checking accounts, accounting for one in five retail transactions.

Even before the 2019 pandemic, cash made up only 27 percent of transactions, a significant drop from 69 percent in 2007.

Data from the Australian tax office shows that 819,000 Australians have bought a cryptocurrency since 2018, with the number of transactions increasing by 63 percent in 2021 compared to 2020.

Treasurer Josh Frydenberg on Wednesday unveils the most extensive changes to the Australian payment system since the mid-1990s, with new rules for cryptocurrency and buy now and pay later apps like Afterpay

Treasurer Josh Frydenberg on Wednesday unveils the most extensive changes to the Australian payment system since the mid-1990s, with new rules for cryptocurrency and buy now and pay later apps like Afterpay

Non-cash payments in Australia are now worth $650 billion a day, with 55 million transactions being made via tap-and-go online purchases and wire transfers.

Cryptocurrency Changes in 2022

LICENSE: New regulations would apply to digital currency trading platforms

CENTRAL BANK DIGITAL CURRENCY: Government explores idea of ​​a digital currency for Australia’s central bank

REGULATIONTreasury argued Australian regulation was needed so Australian businesses and consumers were not governed by foreign governments and big corporate rules

The Council of Financial Regulators – comprising Treasury, the Reserve Bank of Australia, the Australian Prudential Regulation Authority and the Australian Securities and Investments Commission – will make recommendations by mid-2022.

Bitcoin has risen in value in 2021, from less than $25,000 a year ago to $71,200 today.

But a month ago, it was worth over $91,000.

In May, Bitcoin lost a third of its value, from $74,000 to $50,000, within a week after billionaire Tesla founder Elon Musk changed his mind when he accepted Bitcoin as payment for his electric cars.

The 50-year-old tycoon argued that cryptocurrency mining, creating Bitcoin by solving complex math puzzles, used too much fossil fuels and his statement caused a 16 percent plunge in just one day.

Until cryptocurrency is regulated, the only regulated products linked to cryptocurrency are funds traded on the Australian Securities Exchange.

BetaShares launched CRYP on the ASX this month which invests in companies involved in the broader crypto investments.

Bitcoin has risen in value in 2021, from less than $25,000 a year ago to $71,200 today.  But a month ago, it was worth over $91,000.  In May, Bitcoin lost a third of its value, from $74,000 to $50,000, within a week after billionaire Tesla founder Elon Musk changed his mind when he accepted Bitcoin as payment for his electric cars.

Bitcoin has risen in value in 2021, from less than $25,000 a year ago to $71,200 today. But a month ago, it was worth over $91,000. In May, Bitcoin lost a third of its value, from $74,000 to $50,000, within a week after billionaire Tesla founder Elon Musk changed his mind when he accepted Bitcoin as payment for his electric cars.

In November, Tony Richards, chief of payments policy at the Reserve Bank of Australia, said a major plunge in cryptocurrencies was likely.

“There are plausible scenarios in which a range of factors could come together to significantly challenge the current fervor for cryptocurrencies, so that current speculative demand could begin to reverse, and many of the price increases of recent years could be reversed,” he told Australian. Corporate Treasury Association.

The Commonwealth Bank announced in November that it would allow cryptocurrency trading on its banking app, making it the first bank in Australia to allow it.

Australia’s largest bank’s 6.5 million customers will be able to buy and sell digital currencies such as Bitcoin the way they do stock transactions via a CommSec app.

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