To be “competitive with Singapore, the United Kingdom, and the United States,” Australia has to implement new laws for digital asset miners, such as tax breaks and a licencing scheme for crypto exchanges, according to a Senate report.

The Senate’s Committee on Australia as a Technology and Financial Centre released a report on Wednesday that calls for further clarification on when banks can refuse to work with a corporate customer that is involved in bitcoin.

Due to the significant dangers, many of Australia’s leading financial institutions have avoided engaging with the cryptocurrency sector, despite its massive expansion in the last year.

According to the research, Australia has to change its rules to create room for companies with a “decentralised autonomous company structure,” as well as its tax rules to ensure that people only pay taxes on trading digital assets when they achieve a “clearly identifiable financial gain.”

“It means Australians can have more control of their financial destiny rather than being dependent on endless intermediation,” committee chair Andrew Bragg said.

“The committee has recommended a comprehensive crypto framework to deliver Australian leadership. We`ll be competitive with Singapore, the UK and the US,” he added.

Australia has failed to keep up with the rise of the digital asset economy, which includes cryptocurrency exchanges, blockchain-based security tokens, and non-fungible tokens, or “NFTs,” which provide online property ownership.

The Australian Taxation Office has seen a “dramatic rise in trade” since early 2020, when COVID-19 lockdowns spurred a frenzy of online investing activity, driving some cryptocurrency prices to record highs, according to the study.

The size of the whole Australian digital assets market, on the other hand, is commonly estimated. According to researcher, a sixth of Australians owned cryptocurrency worth A$8 billion ($6 billion) in 2021, with bitcoin being the most popular.

Participants in the digital market applauded the findings, but cautioned that rules needed to change more quickly.

It has “strong recommendations (but) the speed at which we`re trying to actually implement regulatory change, and the speed with which this technology is changing, are just poles apart”, said venture capital investor Mark Carnegie, who has digital asset interests.

Caroline Bowler, CEO of bitcoin exchange BTC Markets, said the report surpassed expectations by including “pragmatic recommendations … to give a massive leg up in putting Australia on the global fintech map”.