Madonna Jarrett (Brisbane, Australian Labor Party) Share this | Hansard source

I rise to speak to the Corporations Amendment (Digital Assets Framework) Bill 2025. As our world continues to change, so too do our financial markets, and so does the way people are holding and exchanging value. That's why the Albanese government has introduced this legislation. We are helping to unlock innovation and protect Australian consumers investing in digital assets.

Across the world, digital assets are reshaping finance. Blockchain technology and tokenisation are unlocking new ways to invest and new ways to trade and transfer wealth. Millions of Australians are using or investing in digital assets every year, and this law is about making that as safe and secure as possible while also encouraging innovation.

But what are digital asset platforms and tokenised custody platforms? They're a bit obscure to many people. So, to start with, let's define what we mean by 'digital asset platforms'. In plain English, these are businesses that let customers interact with things like cryptocurrency—such as bitcoin and stablecoins—tokenised assets, non-fungible tokens and other blockchain-based financial products. These platforms include exchanges, broker services, custody providers, yield or staking platforms, wallet providers and marketplaces.

Tokenisation is the process of representing something valuable as a digital token on a blockchain. A blockchain is a distributed ledger using cryptographics—I know this sounds a bit complicated—to enable digital assets to be created, stored and transferred. The token represents something valuable. It might be real estate, shares in a company or commodities like gold. It could be artwork, carbon credits or invoices. Tokenisation, basically, answers a simple question: what if we could own, trade and transfer real-world value like we transfer digital information?

The phrase 'tokenised custody platforms' refers to a new wave of businesses that go beyond trading. Instead of being a general exchange, they build purpose-specific systems, such as tokenised property investment platforms, tokenised private markets, medical credential tokens, supply chain token platforms, tokenised rewards or creator economies. These platforms are customised to specific industries, but the key point is that they still involve money, they still involve an asset of value, they still involve investment-like behaviour and they still expose consumers to financial risk.

Our government takes Australia's crypto industry very seriously, and we know that blockchain and digital assets present big opportunities for our economy, our financial sector and our businesses. Digital assets are also reshaping global finance, and they include cryptocurrencies such as bitcoin and stablecoins, as well as real-world assets like bonds, property and commodities—things I spoke about earlier. They can be represented as digital tokens.

I remember when I first heard the words 'bitcoin' and 'cryptocurrency'. It sounded to me a bit like these were out of TheMatrix movie. And, for quite a while, it was a system that was on the fringe and people didn't know a lot about it. It was more of an alternative payment system, but it has now become a lot more mainstream and is providing an alternative payment system. This is not a distant future. This is happening now. Global institutions are experimenting with tokenised securities, central banks are exploring digital currencies and investors are demanding safe, regulated ways to participate.

These innovations promise faster payments, lower costs and broader access to markets. In fact, new research from the Digital Finance Cooperative Research Centre indicates that Australia could capture as much as $24 billion a year in productivity and cost savings thanks to unlocking digital finance innovation.

But, as with all value creation and transfer, there are risks. These laws are designed to deal with both the opportunity and the risk. They will boost confidence, attract investment and support jobs and wages by providing clear, trusted rules for emerging digital markets, helping to make Australia a global leader in financial technology. They will also help reduce the risks to Australians. Currently, businesses can hold unlimited client digital assets without financial law safeguards. The Corporations Amendment (Digital Assets Framework) Bill introduces clear, enforceable rules for businesses that hold digital assets on behalf of consumers, ensuring that they meet the same standards of transparency, integrity and protection that apply across the financial system.

If we get this right, we can attract investment, we can create jobs, and we can position our financial system as a leader in innovation. But, as I said, with opportunity comes risk. It is currently possible for a business to hold an unlimited value of client digital assets without any financial law safeguards. The collapse of FTX and other failures show what happens when digital asset businesses operate without proper oversight. Billions were misappropriated. Consumers lost a lot of value. Consumers were devastated. Confidence was lost. And we all know that cryptocurrency remains a vector in scams and frauds. Australians have lost millions to schemes that exploit gaps in regulation and consumer knowledge.

These reforms will increase integrity in the digital asset ecosystem. Together with the world-first Scams Prevention Framework and our proposed reforms to Australia's Anti-Money Laundering and Counter-Terrorism Financing regime, this bill will help remove bad actors and restore trust in the digital asset markets. It will make it harder for criminals to operate and easier for consumers to participate safely. By introducing digital assets and tokenised custody platforms into the Corporations Act, it ensures that businesses holding and dealing in client digital assets are subject to the same consumer protections and licensing requirements that apply across the financial system. These include prohibitions on misleading and deceptive conduct, unfair contract terms, design and distribution obligations and supervision and enforcement by the Australian Securities and Investments Commission, the regulator. Anyone providing services in relation to digital assets or tokenised custody platforms, such as advising on them, dealing in them or arranging for others to deal with them, will be treated as providing a financial service.

Protecting consumers and businesses has to be at the heart of this legislation. This bill does respond to the risks and challenges by reducing loopholes and ensuring comparable activities face comparable obligations, but it's tailored to the digital asset ecosystem. The digital asset and tokenised custody platforms will now need to hold an Australian financial services licence, ensuring that they are subject to the same core obligations as the more traditional players. These include the requirement to act efficiently, honestly and fairly; prohibitions on misleading and deceptive conduct and unfair contract terms; a requirement to give customers clear information about how assets are held and what their rights are; providing information to consumers; maintaining strong governance and risk controls; and providing accessible dispute resolution and compensation if things go wrong. While digital asset platforms and tokenised custody platforms will be regulated under the existing Australian financial services licence framework, their obligations will be tailored to reflect the unique structure and risk profile of these types of platforms.

Small-scale operators with less than $10 million in transaction value across a rolling 12-month period will be exempt from licensing, as will businesses that deal in or advise on platforms only incidental to their main non-financial activity. Flexible powers are provided to the minister and to the regulator, ASIC, to respond to emerging risks and technologies. The minister may designate certain facilities as financial markets or clearing settlement facilities or exempt them when their treatment would be inappropriate. The minister may also prohibit particular products or activities that represent systemic or consumer risks. ASIC's existing product intervention powers—that is, the powers of the regulator—and the government's existing regulation-making powers will extend to cover these new financial products.

There will be an 18-month transition period, and this will help businesses and the regulator get familiar with navigating the reforms in practice. The bill aims to ensure a smooth pathway to the new regime, including providing temporary relief for businesses trying to do the right thing. Together, these features create a pathway to a clear, consistent and enforceable framework that protects consumers, provides regulatory certainty for industry and maintains flexibility as technology and markets innovate and evolve.

Stakeholders have long called for this bill, engaging in four rounds of public consultation on the policy and legislative approach. These reforms strengthen consumer protections and modernise Australia's regulatory system. They will boost confidence, attract investment and support jobs by providing trusted rules for emerging digital assets. Labor's economic plan is all about modernising Australia's economy to boost wages and growth, to encourage innovation and to increase living standards, and this legislation is an important part of that strategy.

Digital assets are a growing part of our financial system. We cannot ignore that. They offer new ways to trade, invest and build businesses, unlocking capital and strengthening Australia's competitiveness as a financial centre. Australia must keep pace. This bill delivers on the government's commitment to modernise Australia's regulatory framework and prepare it for an ever digitising economy. It ensures digital assets and tokenised custody platforms are subject to the same standards of consumer protection, transparency and integrity that apply across our financial system. This is about foolproofing Australia's regulatory settings.

The bill supports innovation and competition while giving regulators the tools to act swiftly when new risks arise—and, at the current rate of innovation, that is greatly needed. It extends longstanding, well-understood financial services obligations that can be applied across a wide, diverse and rapidly developing industry. It's another step to making Australia's economy more dynamic, more resilient and more productive. It advances our commitment to smarter regulation that gets more investment flowing more efficiently and more effectively across our economy. As a government, we have listened, improving regulatory clarity and ensuring seamless interaction with existing laws. The government is committed to strengthening Australia's position as a global leader in financial innovation—one where technology supports productivity, competition and long-term economic resilience. This bill is good for consumers, it's good for businesses, it's good for the economy and it's good for Australia's reputation as a leader in financial regulation and financial services. I support this bill.

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