Building Digital Futures at the Digital Economy Conference

The Australian crypto and blockchain industry convened on the Gold Coast this week to survey the future of the digital economy. The conversation focused on the infrastructure for the digital economy, real world use cases, regulatory changes and the increasing sophistication of the industry.

The tone was set early with new research from the Digital Finance CRC and supported by OKX on the economic efficiency gains that can be unlocked by blockchain technology.  The study indicates that Australia could unlock up to $19 billion in annual productivity gains from better payments and better markets alone. That equates to 1% of Australia’s GDP. OKX Australia’s CEO quoted Talis Putnins, the DFCRC’s Chief Scientist - this is a “light bulb to LED” moment for finance - same idea but more efficient.

Daniel Mulino, the new Assistant Treasurer, confirmed the Government’s intention to push forward on digital asset reforms is an important aspect of its future productivity agenda.

Stand with Crypto - a policy initiative to increase political engagement to support the industry - has now reached over 12000 members in Australia. David Menz reiterated the importance of taking steps to continue advocacy and momentum on legislative reforms. The organisation is encouraging constituents to reach out to their local members to press for momentum.

The conference then dived into a range of frontier technologies and use cases that are shaping the digital future including quantum, agentic AI, supply chain, health, telecoms and space.

Agentic AI and blockchain were made for each other

Trevor Topfer, Avatar Global

Evan Gallagher from AUSTRAC updated the conference on the regulator’s recent work targeting crypto ATMs as part of its internal crypto taskforce. AUSTRAC is also preparing for the new VASP regime which will cover a wider range of virtual assets, virtual asset services and involve new reporting requirements. This will cover no KYC exchanges, crypto remittance, tumblers and mixers.

Custodial services including mutisignature custodial services are also within scope. Providers should start preparing now by considering what services they provide, risk assessments, AML/CTF programs, governance and travel rule compliance. AUSTRAC expect exemptions to the travel rule to be narrow given many FATF jurisdictions have already rolled out travel rule compliance for digital assets. However, Interoperability between travel rule compliance providers will be key. Webinars for VASPs on the transition will start next month.

DFCRC’s Elizabeth Reed and Dr Tony Richards provided an update on Project Acacia which is exploring how digital money can support wholesale tokenised markets. This is a sequel to the successful CBDC pilot focussed on wholesale settlement of digital assets and how tokenised private and public money can co-exist to support these new markets. There are 30 use cases from 16 proponents under consideration across a range of asset classes - fixed income applications, carbon credits, trade receivables. The final test cases are expected to be announced in coming weeks - some will involve stablecoins and public money to examine the interchange and settlement questions.

Overall, the future of Australia’s digital economy appears bright as the industry focuses increasingly on building the economic infrastructure of the 21st century, solving real world problems and unlocking productivity gains. Meanwhile, there is fresh opportunity for policy makers and industry to work together to develop strategic reforms to promote Australia’s ability to embrace this future and harness the benefits of the digital economy.

Written by Steven Pettigrove with Michael Bacina