On December 12, 2024, Australia announced proposed stricter Anti-Money Laundering and Counter-Terrorist Financing (AML/CTF) regulations aimed at enhancing oversight of the cryptocurrency sector to combat financial crime.
The Australian Transaction Reports and Analysis Center (AUSTRAC) introduced these rules following amendments to the AML/CTF Act passed in November. The updated framework is designed to close regulatory gaps and improve oversight of high-risk sectors, including cryptocurrency exchanges.
The draft rules are open for public consultation until February 14, 2025, inviting feedback from industry stakeholders. Key proposals include mandatory customer due diligence (CDD), enhanced reporting obligations, and stricter Travel Rule requirements for international transfers.
Additionally, the framework aims to reduce compliance burdens by shifting to an outcomes-based compliance model, allowing businesses to customize their compliance measures according to their size and risk profile.
This initiative is part of a broader trend of increasing regulatory focus on the cryptocurrency industry in Australia, highlighted by the establishment of a task force on December 6, 2024, to oversee crypto ATM providers and ensure they meet minimum standards to mitigate the risk of illicit financial activities.