Financial crimes investigator and regulator AUSTRAC has called on inactive cryptocurrency exchanges to withdraw their registrations or risk cancellation.
Currently, 427 digital currency exchanges (DCEs) are registered with AUSTRAC, of which, the regulator says, a “significant proportion” appear to be inactive.
DCEs, those entities enabling the trade of cryptocurrencies and digital currencies (which includes cryptocurrency ATM providers) for cash, and vice versa, must register with AUSTRAC before they can offer their services.
The regulator, however, can cancel a registration where it finds reasonable grounds that the person or business is no longer carrying on a business that provides a DCE service.
AUSTRAC stressed that businesses are required to keep their details up to date, including details about services that are no longer provided.
Chief executive of AUSTRAC Brendan Thomas warned that inactive crypto exchange businesses – already in a high-risk sector for illicit financing activity – remain vulnerable to being bought and co-opted by criminals.
“The [registration cancellation] blitz is aimed at limiting harm to our community, making it harder for criminals to launder their money and improving the integrity and accuracy of our register, so we’re urging businesses to ‘use it or lose it’,” he said.
DCEs remain particularly vulnerable to exploitation for money laundering, investment scams and money mule activities, he cautioned, with cryptocurrency transactions able to be easily anonymised and their sources made untraceable.
“We’re aiming to protect consumer confidence in AUSTRAC registration and limit the potential for improper sale and use of DCE businesses,” he said.
According to figures from the Australian Federal Police, Australians reportedly lost around $180 million worth of cryptocurrency to investment scams (around half the total losses of investment scams) through 2024.
AUSTRAC late last year also put cryptocurrency ATM providers on notice, announcing the formation of a taskforce to take down non-compliant operators that pose a high money laundering risk.
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AUSTRAC warns crypto exchanges to ‘use or lose’ their regos – FST Media
