Blockchain Australia, a key organization representing the local cryptocurrency sector, has formally presented the federal government with its crypto regulatory proposals.

Last Friday, the group submitted a statement to the Senate Select Committee on Australia as a Technology and Financial Centre, urging the government to establish a safe harbor for local crypto service providers.

Blockchain Australia emphasized the need for a coordinated and phased approach to adopting a fit-for-purpose regulatory framework guaranteeing innovation and competition in the nation while improving consumer outcomes.

As part of the proposals, Blockchain Australia suggested forming a cross-sector regulatory working group to promote more communication between the cryptocurrency community and financial regulators. Many Australian authorities, including the Australian Securities and Investments Commission (ASIC), the Australian Prudential Regulation Authority, the Reserve Bank of Australia, the Australian Competition and Consumer Commission, and the Australian Taxation Office, have been mentioned by the organization.

Blockchain Australia notably requested that ASIC alter the local custodial service rule known as RG133 to explicitly indicate that licensed custody providers are permitted to provide crypto asset custodial services.

Related: United States is Leading with 48 Crypto ATM installations everyday

The announcement comes as several local financial players raised worries about the bitcoin business in Australia. The Australia Securities Exchange sent a report to the Senate Select Committee on Financial Regulatory Technology in mid-July, warning about the security concerns of crypto custody on centralized cryptocurrency exchanges.

Previously on October 6, 2020, the FCA announced guidelines prohibiting the selling of derivatives and exchange-traded notes that reference unregulated transferrable crypto-assets to retail customers. Unregulated transferrable crypto-assets are those tokens that are not designated investments in legislation or are deemed e-money, as defined by the UK’s token categorization scheme.

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