Consumer advocates are urging the federal government to regulate cryptocurrency exchanges. 

CHOICE senior policy adviser Patrick Veyret says Australians expect the same level of consumer protection and regulatory oversight for crypto assets as any other financial products.

Currently, cryptocurrencies are not recognised as a financial product under financial services laws that ASIC enforces, except for exchange traded funds (ETFs) linked to crypto assets.

Mr Veyret said exchanges that sell or control crypto assets need legal obligations imposed on them, including a ban on market manipulation.

“ASIC should also be granted powers to ban certain harmful crypto assets from being marketed and sold to retail investors,” he said.

“More and more Australians are purchasing crypto assets such as Bitcoin and Ethereum without adequate consumer protections.

“We’ve seen a number of recent collapses of exchanges where people have lost all of their savings with no ability to get their money back.”

Before it won the recent federal election, Labor had pledged to look at crypto as part of a broader overhaul of the payments system such as digital wallets operated by Apple and Google.