Australia Approves Crypto Licensing Bill for Exchanges and Custody Firms

Highlights:

• Australia passed a crypto bill requiring exchanges and custody firms to obtain an AFSL licence.
• The new framework gives ASIC stronger powers over custody, disclosure, settlement, and platform conduct.
• Smaller firms get exemptions, while the full crypto framework will roll out gradually.

Australia has moved closer to clear crypto rules after Parliament passed the Corporations Amendment (Digital Assets Framework) Bill 2025 on Wednesday. Under the bill, crypto exchanges and custody platforms in Australia would need an Australian Financial Services Licence (AFSL) from the Australian Securities and Investments Commission.

Treasury introduced the bill last November. The bill aims to create a clearer legal framework for businesses that hold or manage digital assets for consumers, while also giving regulators broader powers over the sector.

BREAKING: AUSTRALIA HAS OFFICIALLY ENTERED THE CRYPTO REGULATION ERA

Australia has passed its first crypto law, requiring all exchanges and custody providers to hold a financial services licence.

The parliament passed the Digital Assets Framework Bill on April 1, ending years… pic.twitter.com/JnAMd9PI9u

— BSCN (@BSCNews) April 1, 2026

What the Bill Changes for Crypto Platforms

The new framework defines key terms such as digital tokens, digital asset platforms, and tokenized custody platforms. Simply put, it targets businesses that hold customers’ digital assets or manage tokenized assets for them. The Parliament says the bill applies the financial services law more clearly to these platforms instead of leaving them in a legal grey area.

According to the bill, platforms must meet custody standards, disclose risks to customers, and follow consumer protection rules similar to those for banks or investment firms. Another key part of the bill is ASIC’s bigger role in the sector. 

Under the proposal, ASIC and the relevant minister would get powers to regulate these platforms. The agency would also have broad oversight and enforcement powers. That means ASIC could supervise areas such as custody, settlement, disclosure, and other conduct rules, with civil penalties available if firms break them.

Not every crypto business would need a full licence under the bill. It includes exemptions for smaller or lower-risk services. For example, platforms that hold less than $5,000 in digital assets for each customer and handle under $10 million in yearly transactions would not need an AFSL. Businesses where crypto is only a small part of their service, such as a retailer accepting crypto as one payment option, could also be exempt.

The bill also leaves out public blockchain infrastructure and some custodial staking arrangements. In simple terms, the goal is to avoid putting full licensing rules on technical services that do not directly control customer funds.

Transition Period Gives Industry Time to Adjust

The timing also matters for crypto businesses in Australia. The bill would start 12 months after Royal Assent, and firms would then get 18 more months to meet the new licensing and operating rules. So while Parliament has already passed the bill, the full system would still take time to come into effect.

For the average crypto user in Australia, the new framework could mean greater protection. This could help prevent some of the damage done in the failure of exchanges like FTX. For the industry, the bill will also mean greater clarity. No longer will they have to navigate unclear and fragmented regulations. Instead, they will have a clearer path to do business in Australia.