Most of the damage done to consumers in the crypto space is not from the tokens themselves, but from the platforms that work with them – exchanges, custodians, creditors and income services.
The finding is at the heart of a new paper presented this week by Rhys Bollen, head of fintech at the Australian Securities and Investments Commission, which argues that Australia should stop treating digital assets as something entirely new and start enforcing the financial laws already on the books.
Control what it does, not what it’s called
Bollen made the case at the Melbourne Money and Finance Conference, where he argued that crypto tokens should be valued based on their economic function. A token that acts as a security must be treated as a token. A stablecoin that transmits money must be subject to the law of payments.
Consumer protection rules should take all the rest. His argument removes the technological packaging and asks a simpler question: what does this thing actually do?
Paper presented at the Melbourne Money & Finance Conference, University of Melbourne by Dr. Rhys Bollen, Senior Executive Leader, FinTech
Crypto specific law
This framework puts Australia in line with how other countries have gone about it. The US is pushing the CLARITY Act, a targeted cryptographic framework. The European Union has introduced its own Markets in Crypto-Assets regulation, known as MiCA. Both create special regulatory structures for digital assets.
Rather, Bollen’s position is that building a separate system from scratch misses the point — and leaves loopholes that bad actors can find.
“Possibilities for regulatory arbitrage” is how Bollen describes these gaps. Make a specific cryptographic law, and someone has built a product that falls outside of it. Attach crypto to the existing law based on what the product does and that exodus goes down.
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Australia has already written it into law
Australia does not wait for theory. The country’s Digital Assets Framework Bill, currently making its way through Parliament, does not seek to replace the Corporations Act.
Reports suggest that the bill would amend that – placing digital asset platforms into the existing regulatory structure, rather than building a lane next to it.
ASIC’s own guidance document, Information Sheet 225, has already confirmed that existing definitions of financial products and services in the Corporations Act may apply to crypto, depending on how a given asset works.
Bollen is direct about what this means in practice. According to him, regulators should focus on the middlemen – the companies that sit between users and their crypto – rather than the tokens themselves. That’s where consumer damage is really shown.
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