The Year in Focus: 2023 Recap of Australia Crypto Industry
It’s been a wild year for crypto users both in Australia and around the world, with highs and lows seen throughout the industry.
This article recaps the latest information on the Australian crypto community as well as what happened in crypto last year and what lies ahead for 2024.
Statistics for Australian Crypto Users in 2023
A Swyftx survey shows that Australian cryptocurrency adoption is extraordinarily high, with almost one in four Australians owning cryptocurrency, and a similar amount aim to enter the crypto industry in the coming year. Over half of the millennial generation in Australia own crypto, making Australia one of the most crypto-native nations in the world.
Not only that, but Australian crypto investors know what they’re doing. 17% of Australian crypto users reported profits of $10,000 or higher in 2023.
Almost one million Australians claim they are likely to enter the crypto market for the very first time in the next 12 months, painting an interesting image of what lies in store for the industry.
According to Koinly, the age bracket 18-24 is dominated by female crypto users rather than men, and couples with children commonly own crypto.
Interestingly, half of crypto users in Australia earn between $60,000 and $149,999, demonstrating that crypto is not just an industry for the 1% top earners, but something that is more accessible to a wide range of people.
Koinly also had some interesting insights into the NFT industry, finding that over 75% of NFT holders plan to hang on to their NFT assets for the next year without selling. Not only that, but around half of all Australian NFT holders are considering buying more NFTs, perhaps a bullish signal for the somewhat subdued NFT industry.
Australian Crypto Regulation in 2023 and 2024
The Australian Federal Treasury issued a public consultation paper on October 16, 2023, addressing the suggested regulatory framework for digital asset platforms. This proposed structure underscores the government’s commitment to maintaining uniform supervision and protection for consumers.
It aims to achieve this by overseeing digital asset platforms and intermediaries under the existing Australian Financial Services Licence (AFSL) regime. Additionally, a new financial product category called a ‘digital asset facility’ is proposed. You can find further details in the official announcement.
The government is planning to implement a regulatory framework referred to as the ‘financialised functions’ regime, specifically designed for certain activities unrelated to financial products.
This framework intentionally accommodates ‘non-financialised activities involving digital assets that are not financial products,’ ensuring their compliance with additional minimum standards. These activities encompass:
- Token trading
- Token staking
- Asset tokenisation
- Funding tokenisation
Non-financial tokens expected to fall under the financialised functions regime include:
- Tokens indicating membership in a group or support for a cause.
- Tokens redeemable for a non-financial service or tangible goods.
- Tokens representing a right to access a physical location or event.
- Tokens used to balance the supply and demand of a finite resource.
- Tokens providing no entitlements except for ‘factual control’ or having no counterparties.
Under the new framework, cryptocurrency exchanges will need to secure an Australian financial services license if a single client has possessed a minimum of AU$1,500 at any point or if the total assets of the platform have surpassed AU$5 million.
Crypto exchanges will be granted a 12-month period following the implementation of the new regime to obtain licenses and achieve compliance.
Crypto Highlights of 2023: A Recap
In January 2023, the headline news for crypto was that Bitcoin had reached $22k. By January 2023, Goldman Sachs had ranked Bitcoin as the year’s best performing asset.At the end of 2023, Bitcoin prices had just about doubled.
🐳 #Bitcoin has now surpassed $22.7k for the first time since August 18, 2022. The price rise has come as the large whale tier group of addresses holding 1,000 to 10,000 $BTC has collectively accumulated 64,638 ($1.46 billion) $BTC in the past 15 days. 👍 https://t.co/H6jCsZDgUR pic.twitter.com/RaN2I48ybg
— Santiment (@santimentfeed) January 20, 2023
The year was also characterized by multiple SEC lawsuits against exchanges including Kraken, Coinbase, and Binance, as well as the Ripple (XRP) crypto project.
A judge ruled that Ripple was not a security, as claimed by the SEC, amounting to a major victory against the SEC. On the other hand, Binance was fined $4.3 billion for money laundering in November 2023, with CEO Changpeng Zhao stepping down.
Former FTX CEO Sam Bankman-Fried was found guilty of Fraud in November 2023, with sentencing now scheduled for March 2024.
Finally, of course, Bitcoin prices closed the year at a staggering $42,000, painting a promising picture of things to come for crypto.
Australia’s Crypto Industry in 2024
What comes next for crypto in Australia is anyone’s guess.
With huge rates of adoption, competent regulation, and sevrices like Grineo making it possible for Australia’s growing crypto community to spend crypto like cash anywhere they go, the sky is the limit when it comes to crypto in Australia this coming year.
