Senator suggests that tax cuts could transform Australia into a ”crypto hub.”

<p>Defining the regulatory agenda</p> <p>As it attempts to set a regulatory agenda for the sector, the federal government has hinted that preferential tax treatment for cryptocurrency businesses is on the table.</p> <p>Senator Andrew Bragg (who chaired the Australia as a Technology and Financial Centre committee last year) stated at a Blockchain Australia conference that he does not want Australia to miss out on the opportunity to become a blockchain hub.</p> <p>"Australia had hoped to become a hub for asset management," Bragg once said.</p> <p>"That has not occurred: 96 percent of the funds under management are domestic," he said.</p> <p>He attributed this to a previous Labor government's failure to pursue the necessary legislative changes to attract the sector, and stated that he hoped to avoid this happening to the blockchain sector in the future.</p> <p>Bragg told the conference that four key policy actions should take place before the end of the year: terms of reference for the Board of Taxation, which will establish an enquiry into taxing crypto assets; an enquiry into the causes and policy responses to de-banking by the Council of Financial Regulators; consultation on the "market design" (for example, licensing) of crypto markets; and a final consultation on the custody regime, which will cover custodial or deposit services.</p> <p>"The reality is that we do not live in a libertarian utopia," Bragg told the conference.</p> <p>"Regulatory arbitrage is not an option."</p> <p>"There is widespread agreement on the importance of addressing proper legal design."</p> <p>To reduce the possibility that Australia will miss out on its "cryptocurrency hub" opportunity, Bragg suggested that instead of attempting to amend the already complex Corporations Act, "we should have a very simple, clear, and clean Digital Services Act."</p> <p>DAOs, which some believe could replace corporations, should also be investigated as part of any cryptocurrency regulatory regime, according to Bragg.</p> <p>He warned that the