With the rising popularity of cryptocurrency, you may have considered starting your very own cryptocurrency trading business. Before you can start trading, there a few essential things you have to set up to ensure you have a secure, efficient and popular platform.
Setting Up a Cryptocurrency Business
Setting up a business requires a lot of research and hours of work. The best way to keep yourself on the right track is to layout a business plan with a to-do list and rough schedule. You can find out more about how to write an effective business plan here.
When starting up a cryptocurrency exchange business, you also need to consider what business structure will suit the functionality of your practice. It is important to choose the right fit for your business whether that be a sole trader, partnership etc. This quiz can help you determine what the best structure is for your business’ needs. You can also find more information about different business structure types here.
Registering for an Australian Business Number (ABN)
All businesses in Australia are required to register for an ABN in order to be able to operate the business in Australia. An ABN is needed for the purposes of giving invoices, processing taxes etc. Registering for your ABN is an extremely simple process and can be done here.
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Registering with the Australian Transaction Reports and Analysis Centre (AUSTRAC)
Cryptocurrency exchanges must register with AUSTRAC before operating. Additionally, some service types also have to enrol with AUSTRAC. Usually, digital exchange businesses must both enrol and register with AUSTRAC. Some information that you will need to provide for registration include:
- The business structure
- Financial statements
- Contact details for the business
To download the registration form click here.
If you need further guidance on how to complete the form click here for a guide.
Setting up an AML/CTF program
Generally, AUSTRAC requires financial services such as cryptocurrency exchanges to create and implement an Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) program. Your AML/CTF program should demonstrate the steps your business will take to reduce the risk of fraud, financial crimes and other malicious activity. It should also show how these issues will be handled and how the business will locate suspicious activity. For further information about creating an AML/CTF program check out AUSTRAC’s website.
Creating a Website
As a cryptocurrency business, creating a website and effective platform is an extremely important step. It can make or break the success of your business as it is your customers’ main access point to your business.
For your website, it is essential to create terms and conditions that outline information such as payment methods and liability clauses. You can learn more about how you can easily create terms and conditions, here.
You will also need a privacy policy. A privacy policy will allow your customers to understand how their information is being collected and used. You can find further information about creating a privacy policy here.
Summary
Starting up and regulating your cryptocurrency trading business is not an easy project. It is best to consult a lawyer about your business’ legal obligations according to your specific business format. You can also use this tool to check if your business has any legal gaps or to see if there are ways it can further enhance its legal health.
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