Thank you very much. Well, look, it shows the great technological proficiency of DECA that you've managed to get me in despite my technological ability to make constant errors, so I'm really glad to be here today at this very important conference.
Could I firstly just say good morning to everyone and welcome to the Global Digital Asset Regulatory Summit. Can I also pay my respects to the Traditional Owners of all the lands that we're meeting on and pay my respects to elders, past and present.
It's a great pleasure to be able to be here today to open this summit. I'd like to thank the Digital Economy Council of Australia for once again hosting this very important event, and in particular, can I acknowledge Amy‑Rose Goodey, the CEO of DECA, but also all of her team. I know how much hard work would have gone into the preparation of such a significant event, and can I also reiterate Amy‑Rose's acknowledgement of all the sponsors which are obviously critical to making important events like this possible.
I understand that there are 450 registered participants, a very significant number in Australia, and a very significant number globally, and that reflects the importance of the issues that you're going to be discussing today.
This event is a great opportunity for policy makers, regulators and industry leaders to compare approaches and share ideas as governments around the world are moving towards greater regulatory clarity.
Really importantly, today the Australian Government has released exposure draft legislation for the digital asset platform reforms which I know so many of you have been waiting for, for a long time.
This is a preliminary version of the legislation, and we are seeking stakeholder feedback on its effectiveness and clarity before proceeding further.
The final legislation will introduce a new framework for digital asset businesses in Australia. It will do so by extending existing financial services laws, but in a targeted way. It will be the cornerstone of our digital asset roadmap which was released in March.
This is about legitimising the good actors and shutting out the bad. It is about giving businesses certainty and consumers' confidence. It is about working with industry, regulators and the broader community to make Australia a leader in the global digital asset ecosystem.
Our approach is informed by similar moves in peer jurisdictions such as the United States, the European Union and the United Kingdom. By aligning with international best practice Australia can boost the global competitiveness of our digital asset sector.
I appreciate that the industry has been waiting patiently for this moment. I thank you for your support in getting us to this milestone.
Digital assets already fall within Australia's existing legal and regulatory frameworks.
Despite this, failures of digital asset businesses have highlighted the consumer risks, particularly where operators pool and hold client assets without consistent safeguards.
We are addressing this by extending well‑understood and time‑tested Australian financial services frameworks to target the riskiest parts of these businesses. The draft legislation that will be released today aims to manage risks associated with digital asset businesses and to address regulatory uncertainty about how the existing laws apply to products and services in the digital asset place, and this will allow the industry to significantly unlock innovation.
This will be good for both consumers and the sector. It will introduce 2 new financial products in the Corporations Act, the digital asset platform and the tokenised custody platform. This means digital asset platform and tokenised custody platform service providers will need to hold an Australian Financial Services licence.
In addition they will need to provide their services efficiently, honestly and fairly, manage conflicts of interest and have dispute resolution systems. Operators of these platforms will be subject to a suite of obligations designed to accommodate the unique characteristics of digital assets.
This will include complying with minimum standards for holding digital assets and facilitating and settling digital asset transactions.
Above all, we've heard that what you need is clarity in order to innovate. We've heard that broad financial product definitions have left many digital asset businesses unsure about how to operate under Australian law.
We understand that digital assets don't always fit comfortably within rules that were designed for traditional intermediaries. Some can move directly between users, and some have no clear product issuer.
The draft bill that will be released today cuts through this uncertainty by setting targeted rules for key activities, such as activities involving rack tokens, public token infrastructure and staking. This means they will no longer have to be forced into frameworks that were never designed for them.
We also know how this market moves quickly. Rigid rules could leave gaps or stifle new businesses. That's why the framework includes tools to adjust, expand or narrow obligations. Regulators will be able to strengthen safeguards when new risks arise and adapt as technologies and services develop.
The framework does not displace existing laws. It introduces targeted elements of risk mitigation, regulatory clarity and right‑sized obligations. It is a more consistent, workable framework that encourages innovation by giving industry and consumers greater certainty about their rights and obligations.
The government is also working with ASIC to ensure that there are appropriate transitional arrangements ahead of the legislative reforms coming into effect.
So, we are keen to hear your views on this proposed legislation.
Could I also just make a couple of broad comments about Australia's productivity challenge. This government has made it clear that productivity is our highest overall economic priority.
Of course in the long run productivity is how we lift living standards. It's how businesses become more competitive, how workers earn more and how governments deliver services better, in a more targeted way and without adding unduly to the tax burden.
However, Australia's productivity challenges are long‑standing, and they mirror the experience of many developed economies. The Australian Government has a 5‑pillar productivity agenda that responds to this challenge. We are not seeking productivity growth at the cost of higher unemployment or by insisting Australians work longer for less.
We want people to work smarter for better outcomes. We are creating a more dynamic, competitive and resilient economy. We are building a skilled and adaptable workforce, delivering quality care more efficiently, investing in the net zero transformation, and harnessing data and digital technology, because in the long run technology is the main driver of productivity growth.
In the modern world, that largely means data and digital technologies. These technologies are reshaping industries and consumption patterns, making markets more efficient and challenging existing policies and presenting unique opportunities and risks for each country.
Emerging technologies like artificial intelligence have high potential to contribute to productivity growth. Based on early estimates, the Australian Productivity Commission considers that multifactor productivity gains from AI could exceed 2.3 per cent over the next decade, which is very significant given recent productivity trends.
Policy makers worldwide, of course, are working to harness the productivity potential of digital technologies while managing associated risks.
Recent evidence shows that newer, scalable technologies based on software tend to diffuse more rapidly than technology that involve the deployment of traditional physical capital. This means governments need to respond more quickly to harness their productivity potential.
But we also need to get it right. Poorly designed regulation could stifle the adoption of beneficial new technologies and limit their benefits.
So to achieve productivity gains we need a balanced regulatory environment that protects consumers and workers while enabling innovation and productive use.
It's also important that we think about productivity holistically. In many advanced economies declining economic dynamism and competition have reduced firms' incentives to adopt new technologies.
So while smarter digital policy can help reinvigorate innovation and technology uptake, it's not a silver bullet. government's role is also about ensuring our workforce has the skills to use new technology as it emerges. Our markets are set up to use it to drive prosperity, and we apply it to drive down the costs of things like energy and government services, and drive up the quality of outcomes for consumers.
The Productivity Commission's 5‑pillar inquiries will help identify the next round of productivity reforms, including ways to harness data and digital technology to improve outcomes in these areas.
Productivity, of course, was a key theme of Australia's Economic Reform Roundtable last month, which I attended. Over the 3 days leaders from business, unions, civil society and academia came together to work through the big issues.
The discussions highlighted the opportunity and appetite to boost living standards by making our economy more resilient, more productive and by strengthening budget sustainability.
Digital technology and the use of data across our economy featured very prominently in the discussions. The roundtable identified 10 areas of consensus which will help set reform directions for the government.
One of those 10 areas was harnessing data and digital technology to drive productivity and competition. Another important reform direction was making artificial intelligence a national priority.
Following the roundtable, the Australian Treasurer, Dr Jim Chalmers, announced the immediate actions across a number of portfolios, including developing an Australian Public Service AI plan. Another was accelerating work on a national AI capability plan, including national interest principles for data centres.
Of course, as all of you would know, AI is already changing financial services. A recent report by the Australian Finance Industry Association suggested that AI could deliver up to $60 billion in productivity gains by 2035. That is a huge opportunity.
But there are risks too, there are risks to privacy, misinformation, and to some degree, workforce disruption. These are risks we must engage with as a government. The challenge is not to fear these changes, but to manage them in a way that empowers people.
As the Treasurer has said, our job is to make Australia beneficiaries, not victims of technological change. This means investing in skills, education and infrastructure so that businesses and workers can adapt.
Platforms have transformed the way that Australians live, work and connect. We all know the stories. Apple originating from a garage, Netflix posting out DVDs and Amazon selling books online. They all started out as somewhat scrappy outfits and now look where they are. We don't begrudge their success; we welcome it and its effect on the economy overall.
Every business in this room, of course, dreams of scaling up just like that. As markets mature, the risk is that size turns into dominance. A handful of firms now sit at the centre of services, like search, app stores and social media.
A 5‑year inquiry by the Australian Competition and Consumer Commission showed how these firms can sometimes tilt the field through high commissions, closed systems or favouring their own products. This can make it harder for the next wave of innovators to break through. It can make it harder for new entrants to compete, to drive prices down and to give consumers more choice.
Australia's competition laws weren't built for today's fast‑moving digital economy, and that's why we're introducing a new digital competition framework with rules that let regulators step in early before harm is done, and not years down the track.
Platforms with significant market power will face clear obligations which we look forward to consulting on further. Other countries are already moving this way. We're making sure that Australia does to.
For fin techs, this is about making space for all businesses to thrive, a level playing field where the best ideas can rise, where small players can win on merit and not lose on market power, and where consumers get a better deal.
Another issue I wanted to talk about was the consumer data right. Better consumer outcomes can also grow from better access to data, and that's where the consumer data right comes in.
We are part way through a reset of the CDR to make it more practical and valuable for consumers and industry, while putting it on a sustainable footing.
Many fin tech companies are already using the CDR to help Australians switch and save thousands through banking data and energy data. Delivering these benefits in the past required consumers to engage in insecure data sharing practices. This exposes consumers to unnecessary risk. The CDR delivers the same benefits with security and trust built in.
I look forward to working with key stakeholders at this conference in order to make sure that we can move forward with the CDR and that we can maximise the benefits for consumers and reduce the costs for industry.
In conclusion, can I say that the Australian Government is developing a fit‑for‑purpose digital asset regime to help build a more dynamic, competitive and productive economy. We want to seize these opportunities and encourage innovation at the same time as making sure Australians can use and invest in digital assets safely and securely with appropriate regulation.
Thank you for your contribution on this journey. We want you to continue helping us to help you. Thank you very much for the opportunity to participate in today's very important forum, and I look forward to continuing to work with you on digital asset regulation and on the many other exciting opportunities that I've touched on today more broadly. Thank you again.
