Australia grants licencing exemption for stablecoin intermediaries
The Australian Securities and Investments Commission (ASIC) announced that stablecoin intermediaries distributing coins issued by licensed providers will not be required to obtain separate financial services licences. This exemption marks a regulatory adjustment aimed at aligning financial oversight with developments in digital assets.
ASIC’s decision explained
The ASIC Corporations (Stablecoin Distribution Exemption) Instrument 2025/631 grants class relief to intermediaries distributing stablecoins issued by entities that already hold an Australian Financial Services (AFS) licence. This means intermediaries do not need separate licences to distribute stablecoins from licensed issuers. The exemption applies to intermediaries such as exchanges, wallet providers, and payment platforms. They can distribute stablecoins issued by licensed entities without needing separate financial services licences.
AUDM, issued by Catena Digital Pty Ltd, is the first stablecoin to operate under the new exemption. It is pegged 1:1 to the Australian dollar. Catena Digital has obtained an Australian Financial Services (AFS) licence, which permits the legal issuance of non-cash payment facilities. This confirms the company’s compliance with financial service regulations in Australia.
Why ASIC introduced the exemption
Prior to the exemption, intermediaries’ capacity to transfer stablecoins was constrained by high regulatory expenses. By lowering these expenses, the exemption permits more people to participate in the stablecoin market. In a recent white paper, the Treasury described how digital currencies and tokenisation could enhance financial institutions. This framework is reinforced by ASIC’s exemption, which modifies rules to account for digital assets.
Intermediaries must ensure that retail clients can access the stablecoin issuer’s Product Disclosure Statement (PDS), if available. The document outlines the risks and features of the stablecoin. Only issuers with Australian Financial Services (AFS) licences are permitted to create eligible stablecoins. These issuers have met the required financial standards, maintaining a level of consumer protection.
Australia’s digital asset strategy
Australia is examining tokenised real-world assets and central bank digital currencies (CBDCs). The Treasury has stated that these technologies could improve market efficiency and resilience. The stablecoin exemption is part of broader efforts to incorporate digital assets into the financial system, alongside tokenisation initiatives.
In 2024, ASIC issued Information Sheet 225 to clarify how existing financial regulations apply to crypto-assets. In December 2024, ASIC released CP 381, examining whether stablecoins should be treated as financial products under current law. The paper sought input from industry participants and contributed to the development of the current exemption.
The exemption begins the day after its registration on the Federal Register of Legislation and will expire on 1 June 2028. By 2028, the government plans to implement a comprehensive digital asset reform agenda to establish a long-term regulatory framework for stablecoins and other cryptocurrencies.
Future outlook of the Australian market
The US has proposed legislation requiring stablecoin issuers to hold banking licences or operate under federal supervision. Hong Kong has introduced regulatory frameworks that require stablecoin issuers to maintain reserves and follow transparency requirements.
ASIC will work with Treasury to implement the government’s digital asset reform agenda, aiming for consistent policy development. As more issuers obtain Australian Financial Services (AFS) licences, ASIC may expand the exemption to include additional stablecoins. The framework is expected to be fully developed by 2028.
