Australia’s top regulator says crypto has become “increasingly mainstream”, necessitating tougher regulation

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Australia’s top regulator says crypto has become “increasingly mainstream”, necessitating tougher regulation
Australia's top regulator says crypto has become

Surprised by the growing number of crypto investors in Australia, Australian Securities and Investments Commission (ASIC) Chairman Joe Longo expressed concern that many Bitcoin (BTC) and altcoin buyers do not recognize the real risk of invest in digital assets.

According to the last ASIC Report published in early August 2022 which researched over 1000 retail investors in Australia, 44% of them said they owned cryptocurrencies, making it the second most common type of product after Australian shares.

Alarmed by the recent report, Mr. Longo Told the Australian Financial Review August 11:

ASIC is also concerned that there are limited protections for investments in crypto-assets given that they have become increasingly mainstream and are heavily advertised and promoted.

He also has informed The Sydney Morning Herald August 11, 2022:

My concern is that consumers and investors do not fully understand the risks of this business and (…) also do not fully understand what they are investing in. <…> It’s a very speculative and risky business, and I’m afraid consumers who want to invest in it need to be very clear that if they lose their money, there’s not much we can do to get it back.

Another source of concern for Joe Longo was a revelation that 41% of respondents said one of their main sources of investment information was social media platforms such as Facebook, Reddit and TikTok, but also the “finfluencers” of YouTube.

However, since the survey was conducted last year, before ASIC’s crackdown on financial influencers, the researchers’ findings are not an accurate representation of things today.

In addition to social media, some of the “commonly cited” sources of investment information include Google searches (34%), investors’ personal networks such as family and friends (24%) and colleagues (10%). .

Crypto concerns call for tougher regulation

Concerned about the growing popularity of crypto assets in Australia and the lack of regulation on how they are bought and sold, Joe Longo said back in February:

With so many new investors active in capital markets, research builds on our understanding of retail investors and helps us determine where our regulatory efforts are warranted.

Finally, the ASIC chairman also assured investors that he was currently working closely with the Australian government on creating new regulations that would address the problem of unregulated investment scams disguised as advice, which are still one of the most popular sources of financial information today.

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