Australia's financial intelligence unit, AUSTRAC, has launched two targeted supervisory campaigns into the country's virtual assets sector, as new anti-money laundering reforms take effect. The campaigns assess how well crypto businesses are managing money laundering risks under an expanded regulatory framework that now covers custody, brokerage, and other virtual asset services beyond traditional exchanges. AUSTRAC is engaging with 36 over-the-counter crypto-to-cash operators and 27 local crypto exchanges, focusing on AML/CTF risk management and readiness for upcoming reforms. The regulatory overhaul replaces the narrow definition of "digital currency exchange" with the internationally recognized term "virtual asset service provider" (VASP), broadening anti-money laundering obligations to custody, brokerage, and other crypto services. The reforms took effect on March 31, 2026, with additional Travel Rule requirements for virtual asset transfers becoming mandatory on July 1, 2026. AUSTRAC has identified crypto as a top threat in its financial crime crackdown, shifting from compliance-focused regulation to substantive risk and harm monitoring at an industry level. For wallet and key holders, these developments signal tighter scrutiny on crypto businesses, which may enhance security and reduce illicit activity risks. However, increased compliance costs for VASPs could lead to higher fees or reduced services. Users should verify that their service providers are AUSTRAC-registered and compliant, as this helps protect assets from money laundering-related risks. The reforms also align Australia with global standards, potentially influencing international crypto regulation.

Key facts

• AUSTRAC launches two supervisory campaigns on crypto businesses in Australia.
• Campaigns target 36 OTC operators and 27 local exchanges for AML risk assessment.
• New laws expand coverage to include custody, brokerage, and other VASPs.
• Travel Rule for virtual asset transfers becomes mandatory on July 1, 2026.
• Crypto identified as top threat in AUSTRAC's financial crime crackdown.