Australian Senator Proposes a Digital Service Act
Australian Senator Andrew Bragg has proposed a Digital Services Act to address issues like crypto custody, DAOs, and taxation to protect investors. He addressed the proposal at the commencement of the Australia blockchain week conference, hoping to lay the groundwork for crypto legislation in the country.
Senator Andrew Bragg Proposes a Digital Service Act to Lay the Ground for Crypto Legislation
Australian Senator Andrew Bragg has opened the Australia Bitcoin Week Conference with a thud after revealing his proposal of the Digital Services Act (DSA), which calls for crypto regulation. He hopes that once passed; the Act could serve as the cornerstone for the crypto legislation in Australia.
The Digital Services Act calls on regulating cryptocurrencies in licensing, decentralized autonomous organizations (DAOs), custody, taxation, and debunking. In his speech at the conference, he expressed hope that his proposal could protect investors from malicious service providers.
Senator Bragg is not alone pushing for legal clarity in the Australian crypto market. The head of Corporate Development at the Australian crypto exchange Swyftx Michael Harris has also tabled his views. He has revealed that he also wants the government to install stricter standards for operating domestic cryptocurrencies. He also said that such a measure is only a precaution and most Australian exchanges have nothing to worry about as they offer secure service to their clients.
Harris also noted that Australia should lead the world in crypto regulation as it has one of the largest global adoption rates of cryptocurrencies. A recent survey from pollster Finder suggests that about 22.9% of Australians that participated in the survey held cryptos from October to December 2021. That is an impressive number showing why legal clarity is needed for their crypto market.
What Bragg’s Proposal Addresses
During his address at the conference, Senator Bragg explained the four main pillars that the Act is based on. He explained that the DSA is technologically neutral and would be regulated by a minister rather than a bureaucratic agency, and would rely on government resources and workforce.
He also addressed DAOs challenging the related government branches and agencies to screen them more keenly. He even called them “an existential threat to the tax base” under their current operations.
On taxation, Bragg said that DAOs could take away a great share of the government’s taxes as they are not treated as companies. According to data from the Parliament of Australia, company taxes are the second-largest revenue stream for the Australian government. Bragg said that if more companies convert into DAOs, it could be an impending danger to the country’s financial stability.
As a solution, the DSA calls on the government to create a framework to develop a standard for DAOs without meddling with their core principles. The standard would seek to give investors access to assurance, Audit, and disclosure services to help them differentiate between retail and wholesale organizations.
Elsewhere, countries’ need to develop crypto regulations is growing as the world requires uniformity. Fears are rising that the improper regulation of cryptocurrency could be helping some countries to evade economic sanctions. Currently, the US is figuring out whether Russia is using a crypto network of some type to circumvent the current sanctions.
Senator Bragg also wants the government to ensure that sanctions remain and cannot be evaded through cryptocurrencies.
