The Australian Treasury issued a consultation paper on “token mapping” on February 3, claiming that it would serve as a fundamental step in the government’s multistage reform strategy to regulate the market. This announcement has been made. It is intended to contribute to “a fact-based, consumer-mindful, and innovation-friendly” approach to the formulation of public policy.

In this study, some fundamental definitions for cryptographic concepts are proposed using a methodology that is both “functional” and technology-neutral.

At the most fundamental level, it provides an explanation of the fundamental ideas behind cryptographic networks, cryptographic tokens, and smart contracts. A decentralised computer network that is capable of hosting crypto tokens is what the Treasury envisions when it talks about what a crypto network is. The storing of information and the processing of user commands are its two fundamental functions. According to the research study, Bitcoin and Ethereum are the two public crypto networks that have the largest name recognition.

A crypto token is a unit of digital information that can be “exclusively used or controlled” by someone who does not manage the host hardware where the token is stored.This is the definition of a cryptographic token. According to the research report, one of the most important characteristics that sets crypto tokens apart from other types of digital records is the ability to exercise “exclusive use and control.”

A computer code that is submitted to the database of a crypto network is what constitutes a smart contract. It entails intermediaries or agents executing tasks under promises or other arrangements or processes being carried out by cryptographic networks without the need for intermediaries or agents, as well as without the use of promises.

Although the study does not present any legislative efforts and rather suggests that we begin the conversation on this taxonomy, the authors of the article predict that a significant section of the crypto ecosystem will be able to comply with current regulations with only minor modifications. It is the parts of the ecosystem whose services are being assured by public, self-service software that may need the development of a whole new regulatory framework.

The Treasury Department will keep an open mind and listen for input until March 3. Midway through the year 2023, a similar report will be published on the potential licencing and custody framework for cryptocurrencies. This will be the next key stage in the ongoing process of a national regulatory debate.

The consultation document on the regulation of cryptocurrencies was also issued by His Majesty’s Treasury of the United Kingdom on February 1. In it, the financial authority stressed the lack of requirements in the separate law, given that the current Financial Services and Markets Act is capable of covering digital assets. This is due to the fact that the Financial Services and Markets Act was amended in 2013.

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