TL;DR
- Australia identified regulatory gaps in the crypto market as one of the country’s main financial risks for 2026.
- The Digital Assets Framework Bill 2025 will require AFS licenses for exchanges and custodians.
- Crypto adoption reached 31% nationwide.
ASIC flagged regulatory gaps in Australia’s crypto market as one of the main risks to the country’s financial system in 2026. The regulator included digital assets, payment systems, and the use of artificial intelligence among the areas with insufficient oversight and greater exposure to unauthorized conduct.
The Key Issues Outlook 2026 report noted that multiple companies operate outside the current regulatory framework. Some do so under incomplete legal structures, while others actively avoid supervision. This situation increases uncertainty around licensing requirements, complicates enforcement, and exposes users to unbacked advice and deceptive practices.
Vulnerabilities and New Regulations Ahead
Parliament is reviewing the Corporations Amendment (Digital Assets Framework) Bill 2025, introduced in November by the Treasury and the Ministry of Financial Services. The bill establishes the first comprehensive framework for platforms that custody digital assets on behalf of clients. The proposal requires exchanges and custody providers to obtain an Australian Financial Services License and fall under ASIC supervision.
The bill creates two new license categories: one for digital asset platforms and another for tokenized custody services. The regulation targets companies that control customer funds and excludes the underlying technology itself. The regime sets penalties of up to 10% of annual revenue in cases of non-compliance. Companies with annual volumes below A$10 million would fall outside the scope of the framework.
Australia Records 31% Crypto Adoption
The Australian government estimates the framework could generate up to A$24 billion per year in productivity gains. Regulatory progress is set to play a key role in the development of the local market. Crypto adoption reached 31% in 2025, up from 28% the previous year. Self-managed pension funds increased their exposure to crypto assets to A$1.7 billion, seven times higher than in 2021. Major international firms, including Coinbase, are moving forward with services aimed at the pension system.
While the permanent regime is being finalized, ASIC implemented transitional measures. The regulator granted temporary exemptions for the distribution of stablecoins and wrapped tokens until mid-2028, allowed omnibus custody structures, and adopted a no-action approach until June 2026. It also confirmed that stablecoins, wrapped tokens, tokenized securities, and wallets may fall under existing financial regulations and require current licenses.
In addition, the report outlined other risks to monitor in 2026. ASIC pointed to rising retail exposure to private credit, operational failures in pension funds, cybersecurity threats with systemic impact, and potential disruptions to the CHESS infrastructure. The regulator noted that regulatory fragmentation across jurisdictions complicates compliance and results in uneven levels of user protection
