AUSTRAC steps up supervision of virtual assets sector as reforms take effect

AUSTRAC has launched two targeted supervisory campaigns into Australia’s virtual assets sector, as landmark Australian anti-money laundering reforms reshape how virtual asset businesses are regulated.

AUSTRAC’s campaigns focus on virtual asset service providers (VASPs), previously known as digital currency exchanges (DCEs), offering over-the-counter crypto to cash (or vice versa) services, and local exchanges operating in Australia.

AUSTRAC Chief Executive Officer Brendan Thomas said the supervisory campaigns reflect the risk profile of the sector and AUSTRAC’s regulatory priorities.

“AUSTRAC is checking how well crypto businesses in Australia are managing money-laundering risks, ahead of major new laws coming into force,” Mr Thomas said.

“We will continue to provide advice and guidance to assist businesses on how to comply so they are well equipped to manage their AML/CTF obligations.”

Both campaigns are aimed at actively engaging and improving anti-money laundering risk management within the virtual assets sector.

As part of the over-the-counter ‘ramps and rails’ campaign, AUSTRAC is engaging directly with 36 crypto businesses with a focus on their business models, channels, service scale, and how effectively they are managing AML/CTF risks.

AUSTRAC is also engaging with 27 local crypto exchanges, with a focus on reform readiness and improvements to governance arrangements.

As part of the reforms, Australia is adopting the internationally recognised term VASP, replacing the narrower definition of DCE.

Obligations will apply to a growing range of crypto-related products, including custody, brokerage, and other virtual asset services beyond traditional cash to crypto exchange models.

“This is more than a name change,” Mr Thomas said.

“It reflects how this sector has evolved and ensures our regulatory framework remains relevant.”

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