Proper regulation of digital assets could add AUD$60 billion to Australia's GDP
(Kitco News) - A new report commissioned by the Tech Council of Australia indicates that the establishment of a proper regulatory framework around digital assets could add up to AUD$60 billion a year to the country's national GDP by 2030.
The Digital assets in Australia report, which was released on Tuesday, was written by the technology consulting firm Accenture and outlined several potential benefits that the digital asset sector could bring to the country.
"Digital assets (DA) have the potential to transform our lives, offering significant time and cost savings to individuals and businesses," the report said.
Data included in the report estimates that digital assets – which include cryptocurrencies, stablecoins, tokens and central bank digital currencies – have the potential to deliver an "80% reduction in retail payments costs by 2030," reducing the yearly cost for consumers who conduct international transactions by AUD $4 billion and save Australian business 200 million hours per year by automating tax compliance and administration.
Potential benefits of digital assets in Australia. Source: Digital assets in Australia
The report also indicates that the use of digital assets can help merchants save AUD$300 million per year by avoiding losses from fraud, while businesses can save up to 400,000 hours per year in preparing documents for business loans through the use of digital asset record keeping.
On the digital payments front, the report estimates "up to 100% of payments" could be facilitated by digital assets if a retail CBDC is introduced.
"With digital assets, trust is embedded in transactions through technology, offering counterparties safety, efficiency and security in an exchange," the report said.
In order to take advantage of the opportunities offered by digital assets, the report highlighted several areas of improvement that need to be focused on.
"We are facing a tech skills shortage as demand is already outpacing supply and digital asset firms across the nation struggle to secure staff," it said. "Fewer digital asset startups and patents originate in Australia versus other markets, indicating a lack of innovation in the ecosystem. And finally, investment into the sector is lagging peers."
To overcome these challenges, the report recommended a "more proactive and considered approach" to regulating the nascent sector instead of the "precautionary" approach that is currently being utilized.
"Regulation of digital assets should support four key objectives: 1. To support Australia to become a leader in responsible digital asset innovation 2. To unlock economy-wide benefits of digital assets technology 3. To promote financial and digital inclusion 4. To protect consumers, businesses and financial stability."
To achieve these objectives, the report recommended that policymakers adhere to the four guiding principles of outcomes-based regulation; agile, interactive and collaborative design; being global market focused; and the adoption of risk-calibrated regulation.
"This approach to regulating the industry could catalyze $15-$20Bn in additional investment, $10-$15Bn in additional tax revenues, $160 per person in transaction fee savings and 80 hours of time saved per business annually by 2030," the report said.
"Australia has the opportunity to be a leader in responsible digital asset innovation and use. To do this, government and industry must work together to design a modernized regulatory framework, and a growth strategy for trusted digital assets recognizing the potential for this sector to drive innovation, investment and jobs," it concluded.