Stormrake Warns Australia’s Crypto Rules Could Reduce Competition

Smaller Australian crypto firms may reconsider whether to keep operating as licensing and compliance costs rise, according to Michael Milmeister, co-founder and CEO of digital asset brokerage Stormrake. Speaking with Peter Bui, he warned of a possible reduction in competition as Australia prepares its new platform framework for 2027. For Australian Cardano users, the issue concerns intermediaries through which they buy, sell, or hold ADA.

ASIC Proposes Crypto Platform Standards

The Australian Securities and Investments Commission published Consultation Paper 392 on October 15. It sets out proposed standards and guidance for implementing the Digital Assets Framework Act 2026.

The framework covers digital asset platforms that hold tokens for clients alongside associated services, and tokenized custody arrangements in which tokens represent underlying assets held for clients. Proposed requirements address asset protection and segregation, record reconciliation, external custodians, transaction execution, and settlement. Operators would also face financial requirements covering capital, liquidity, and cash flow forecasting.

ASIC describes its approach as aligning protection with comparable financial activities while supporting innovation and investment. The standards remain proposals and may change after consultation.

The September 30, 2026, deadline concerned a separate process under existing law. It applied to the conditions of ASIC’s temporary no-action position for certain providers that already needed relevant authorizations.

Stormrake Details Licensing and Staffing Costs

Milmeister described Stormrake as a broker that uses multiple exchanges to execute client orders. He reported that the company had submitted its application for an Australian financial services license, commonly known as an AFSL.

Preparing documentation, responding to regulatory questions, and engaging external specialists require both money and staff time. Milmeister estimated that the licensing process could take six to nine months.

Approval would not end the expense. He highlighted changes to internal processes and the possible need for additional employees to meet continuing obligations. In his assessment, those demands could make smaller businesses less viable, leaving customers with fewer providers to choose from.

Cardano Users and the 2027 Transition

For Australian customers trading ADA through affected platforms, the proposed standards would govern how those providers safeguard funds and execute orders.

Milmeister also cautioned that self-custody requires preparation. Taking control of private keys transfers responsibility for protecting funds to the user, and he pointed to losses suffered by people who were insufficiently prepared.

ASIC’s published timetable schedules final instruments and guidance for March 2027, before the framework begins in April. Existing operators covered by the new regime have a transition window until October 7, 2027, to apply for a license or vary an existing authorization. CP 392 provides for continued operation while ASIC assesses those applications.

Submissions on CP 392 close on November 27, 2026. ASIC is specifically seeking evidence on compliance costs and effects on competition, alongside alternative approaches that could meet its regulatory objectives.