Australia’s crypto tax could end: Here’s why

Australia is known for its crypto-friendly environmenthowever, recent legal developments could completely change how Bitcoin is taxed domestically.

Bitcoin Reclassification: Major Legal Updates

in May 2025a key ruling by a Victorian Magistrate Michael O’Connell Bitcoin theft suggested that Bitcoin may be recognized as Australian currencynot an asset. This groundbreaking statement sparked heated debate across the crypto community and tax authorities.

Adrian Carter, co-defendant in the case, said:

“Bitcoin was considered Australian money, meaning it is not a CGT asset. Therefore, there is no tax impact on the acquisition and disposal of Bitcoin.”

If Bitcoin is officially reclassified as a currency, this could eliminate capital gains tax (CGT) for BTC trading and create a government Thanks to about $1 billion ($640 million) With past tax collection.

Is Bitcoin really tax-free now?

still. The ruling is Appeal underway and Not officially regulated. The decision attracted attention, Australian Tax Office (ATO) I have it Guidance has not been updated. The existing tax framework will remain ongoing until the High Court confirms Bitcoin as fiat currency.

Australia’s current crypto tax system (2025)

• Cryptography including BTC, ETH, NFTS, Stablecoins, and Defi teeth Classified as CGT assets.
• Target of Capital Gain Tax Intermediate 0% and 40%based on individual income brackets.
• a 50% CGT Discount Applies to the event that the assets have passed 12 months Before it’s sold.
• ATO tracks all crypto activity Non-compliance can lead to legal penalties.

Are there any tax loopholes for crypto investors?

Despite the rumors, There are no loopholes With the current system. Even if investors want a CGT exemption, The law remains unchanged Until Bitcoin is officially recognized as currency by a High Court It is accepted by ATO.

Final Thoughts

Unless Bitcoin is officially reclassified, Australian investors and businesses must follow existing crypto tax rules. ATO continues to treat digital assets as assets rather than money, Capital gains tax continues to apply For all crypto-related transactions.