Blockchain Australia’s new CEO, Simon Callaghan, hopes the Australian federal government will take its cues on crypto regulation from the United Kingdom, Hong Kong and Singapore — but definitely not the United States.
In his new position, Callaghan aims to steer crypto rule-making in the country and avoid making similar moves to the U.S. Securities and Exchange Commission — which is suing the world’s two largest exchanges and has branded at least 68 tokens as securities.
“Regulation by enforcement is the equivalent of having a hammer and seeing everything as a nail. I don’t think that’s the right approach for Australia to be taking,” he said.
On June 26, Callaghan was announced as the industry peak body’s new CEO. He was most recently the digital assets program lead for Cambridge University and a co-founder of corporate service provider MOOPS Tech.
Callaghan’s previous roles include a year as the Asia lead for crypto lender Celsius, but he left several months before the firm’s collapse. He has also had a brief stint at crypto lender Vauld.
His appointment comes after nearly a year of limbo following the departure of former CEO and industry advocate Steve Vallas in July 2022. The CEO role was briefly filled by Laura Mercurio in September 2022, but she parted ways with the organization just weeks later over a difference of vision, effectively leaving Australia’s blockchain industry without an advocate for the better part of a year.
In his new role, Callaghan will represent the association’s 112 members, including Binance Australia, Circle, Ripple and Mastercard, all of which are calling for clearer regulation. He said:
“Everyone wants to know where the goalposts are so people can operate their businesses, build their technologies and create jobs.”
The Australian government has not taken a hardline stance on crypto, unlike American regulators and the administration of U.S. President Joe Biden, Callaghan told Cointelegraph.
The Treasury has a “token mapping exercise” underway to determine how to classify various digital assets ahead of any legislation, which isn’t expected until at least 2024.
“We haven’t seen a strong position really one way or the other from this current government. That could be because they’re looking to take a considered approach, which I would argue is a good approach,” he said.
Consultation open! Today we released the token mapping consultation paper. This consultation is part of a multi step reform agenda to develop an appropriate regulatory setting for the #crypto sector. Read paper & submit views @ https://t.co/4W2msjhP9B @ASIC_Connect @AUSTRAC pic.twitter.com/OGHuZEGvDp
— Australian Treasury (@Treasury_AU) February 2, 2023
He hopes legislators take inspiration from Singapore, Hong Kong and the U.K., which are all developing regulatory schemes that aim to balance innovation with consumer protection.
“They see the benefit from the technology, the innovation and the jobs it creates, as well as benefits to the broader financial sector.”
Reports earlier in June suggested that Hong Kong’s central bank has been putting pressure on major banks to accept crypto exchanges as clients, amid moves from the city to attract international crypto firms and investors.
“The fact that the Hong Kong monetary authorities are encouraging banks to work with the sector, I think that’s the right approach,” Callaghan remarked.
In 2021, an Australian Senate committee report on digital assets recommended that crypto firms should be able to challenge debanking decisions and that banks should be required to conduct due diligence on firms rather than adopt blanket bans on the sector.
Two major Australian banks, however, recently imposed pauses, limits and outright blocks on certain payments to local crypto exchanges, both citing the growing threat of financial scams.
“I don’t think you can just blanket everything in crypto as a scam. You actually need to look at the data,” said Callaghan, who revealed he’s already scheduled meetings “in the coming weeks” with the banks to further understand their position.