AUSTRAC Shakes Up Australia’s Crypto and Money Transfer Industries

Australias financial regulator, AUSTRAC, has taken decisive action against 13 remittance service providers and cryptocurrency exchanges as part of a broader effort to strengthen compliance within these industries. The move is part of an ongoing crackdown on firms failing to meet Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) obligations, with over 50 other businesses currently under investigation for potential compliance breaches.

The regulator's latest enforcement efforts highlight concerns over the under-reporting and non-reporting of suspicious transactions, an issue that has raised alarms about financial crime risks in the remittance and digital currency exchange sectors. As a result, six firms had their registration renewals denied due to key personnel being linked to serious criminal offences, which raised concerns about their integrity and suitability to operate in the financial sector.

Additionally, AUSTRAC has issued regulatory alerts to more than 50 other companies, signalling the possibility of further enforcement actions if compliance failures persist. The regulator's industry-wide investigation, launched early last year, aimed to identify systemic compliance breaches and eliminate non-compliant operators from the sector.

Beyond registration denials, two additional firms have been placed under strict conditions due to their failure to meet regulatory requirements. These businesses now face the risk of suspension or deregistration if they do not rectify their compliance shortcomings. Meanwhile, three firms that were denied registration have ceased operations in Australia entirely.

The crackdown also extended to collapsed crypto exchanges, with AUSTRAC removing FTX Express—a subsidiary of the embattled FTX Australia—and Zipmex Australia from the Digital Currency Exchange Register following their insolvency proceedings. This action reflects the regulators broader effort to clean up the crypto sector and ensure only compliant businesses remain operational.

AUSTRAC currently oversees 417 digital currency exchanges and 5,112 remittance providers across the country. In December 2024, the agency announced its plans to intensify scrutiny on the crypto industry in 2025, with a particular focus on crypto ATM operators suspected of breaching AML regulations.

Australia has emerged as the worlds third-largest hub for Bitcoin ATMs, trailing only the United States and Canada. The number of crypto ATMs in the country has surged to over 1,453, a dramatic rise from just 67 in August 2022, according to data from Coin ATM Radar. This rapid expansion has raised regulatory concerns, prompting AUSTRAC to push for tighter oversight of the sector.

In response to these developments, AUSTRAC proposed stricter AML and CTF regulations in August, aimed at strengthening the regulatory framework for the crypto industry and preventing financial crime. The Australian Securities and Investments Commission (ASIC) also weighed in on the matter, issuing a consultation paper in December that proposed classifying many digital assets as financial products. If adopted, this measure would require firms dealing in cryptocurrencies to obtain financial services licences, bringing them under a more stringent regulatory regime.

As AUSTRAC continues its enforcement actions, the latest crackdown serves as a warning to financial service providers operating in Australia. With increasing scrutiny and tighter regulations on the horizon, compliance will be a critical factor in determining which firms remain in the market and which are forced to exit.