Australia has placed crypto regulatory gaps firmly on its 2026 risk radar, as the country accelerates efforts to close long-standing loopholes in digital asset oversight. The warning comes from the nation’s primary corporate and financial services regulator, which says fast-growing crypto firms operating at the edge of regulation are increasing risks for consumers.
ASIC Highlights Crypto as a Key Risk Area
In its Key Issues Outlook released Monday, the Australian Securities and Investments Commission (ASIC) identified crypto, payments, and AI-driven financial services as major pressure points for the year ahead. The regulator warned that businesses operating outside formal licensing regimes are exposing Australians to unlicensed financial advice and misleading conduct.
ASIC Chair Joe Longo said the agency is tracking “major shifts across Australia’s financial system” as pressures on consumers and markets intensify. He cautioned that diverging global regulatory approaches are creating fragmentation, making compliance harder and increasing the risk of uneven consumer protections.
Licensing Reform Moves Closer
The warning lands as Canberra works to close those gaps through long-awaited licensing legislation. The government’s proposed Corporations Amendment (Digital Assets Framework) Bill 2025, introduced in November, aims to establish Australia’s first comprehensive regulatory framework for businesses that hold digital assets on behalf of customers.
Under the proposal, crypto platforms would be required to obtain an Australian Financial Services Licence (AFSL). The government claims the framework could unlock up to $24 billion in annual productivity gains, while providing clearer protections for consumers engaging with digital assets.
ASIC acknowledged that some crypto businesses legitimately operate outside current rules, but warned that others may actively seek to remain unregulated, fueling uncertainty. As a result, defining the regulatory perimeter and clarifying licensing requirements have become top priorities heading into 2026.
Industry Calls for Clear Boundaries
Academics and industry leaders say clarity is urgently needed. Darcy Allen, Associate Professor at RMIT University and director at the Digital Economy Council of Australia, said the most effective step policymakers can take now is to pass the licensing legislation.
Balancing Innovation and Protection
Others believe Australia is moving in the right direction, but education remains a challenge. James Volpe, founding director of Melbourne-based Web3 education firm uCubed, said licensing rules have evolved significantly but awareness gaps persist.
Allen also pointed to the independent review of ASIC’s Enhanced Regulatory Sandbox as an opportunity to rethink how innovation is handled. The sandbox allows eligible firms to test financial products for up to 24 months without holding an AFSL, provided consumer protections are in place. He suggested Australia could move toward a more open “safe-harbour” model, where innovators are free to experiment unless regulators intervene.
A Defining Year for Tech Policy
With reforms on digital platform competition and AI regulation also advancing, experts say 2026 will be a decisive year for Australia’s technology policy. How regulators ultimately treat crypto and emerging tech firms could shape the country’s growth trajectory for decades, determining whether Australia becomes a leader in regulated innovation-or falls behind more agile jurisdictions.
For now, ASIC’s message is clear: crypto oversight gaps are no longer a fringe issue, but a central risk that regulators intend to confront head-on.
