Regulating the Digital Estate: What the ‘Treasury Laws Amendment Bill 2025: Digital asset, and tokenised custody, platforms’ Means for Wealth Transfer in Australia

Australians now hold more digital assets than ever, yet the law barely recognises them. That gap is about to close, with clarity.

The Treasury Laws Amendment Bill 2025 proposes sweeping reforms for digital asset platforms and tokenised custody platforms. With over 31% of Australians now owning cryptocurrency, this fundamentally reshapes how custody works and how families plan digital wealth transfer.

The bill’s 59 pages of amendments signal Australia’s intent to create comprehensive regulation. This legislation tackles everything from platform definitions to estate planning implications.

What the 2025 Proposed Treasury Bill Proposes (Core Changes)

Definitions introduced: “digital token”, “digital asset platform”, “tokenised custody platform”

The bill creates three cornerstone definitions that will reshape how we understand digital assets legally.

A “digital token” is any digital object that someone can control; meaning they can exclude others from it, use it, transfer it, and identify themselves as able to do so. This definition is deliberately broad. It captures everything from Bitcoin to tokenised real estate to digital art.

A “digital asset platform” is where an operator holds digital tokens in trust for clients. Think of major exchanges like CoinSpot or Independent Reserve holding your cryptocurrency. The operator possesses the tokens, but they belong to you.

A “tokenised custody platform” is different. Here, the operator creates a single digital token for each real-world asset they hold. Possessing that token gives you the right to redeem or direct delivery of the underlying asset. Imagine tokenised gold – your token represents specific gold bars held in custody.

These distinctions matter enormously for estate planning. Each platform type has different custody arrangements, different rights structures, and different implications for inheritance.

Platform Type	What It Holds	Estate Planning Implication
Digital Asset Platform	Digital tokens in trust for clients	Executor deals with platform operator; assets held collectively
Tokenised Custody Platform	Real assets; issues tokens as receipts	Executor can claim actual underlying assets (gold, shares, etc.)
Traditional Exchange	Various digital assets	Depends on specific custody model and licensing status

Platform obligations and standards (custody, trust, disclosure)

The bill suggests obligations through two key standards:

Asset-holding standards (Section 912BE) govern how platforms safeguard client assets, maintain records, and handle client money separately from platform assets.

Transactional and settlement standards (Section 912BF) control how platforms execute trades, handle client instructions, and monitor market makers.

For estate planners, these standards create enforceable frameworks extending into inheritance scenarios. The requirements ensure platforms can demonstrate proper custody arrangements and provide clear audit trails which are crucial for executors managing digital assets.

Prohibitions, exemptions and ministerial controls

The bill grants the Minister significant intervention powers. Section 912BH allows the Minister to prohibit specific financial products from being held on particular platforms. These prohibitions can be conditional, temporary, or permanent.

The bill also creates exemptions. Small platforms with under $10 million annual transactions can operate with lighter licensing requirements.

For families, these ministerial powers create both opportunities and risks. Platforms gain legitimacy through regulation, but sudden restrictions could affect asset access during estate transitions.

Why It Affects Estate Planning & Custody

Custody risk in digital estate portfolios

The bill fundamentally changes custody risk assessment. Platforms must clearly specify whether they hold assets in trust, whether clients have redemption rights, and how assets are safeguarded.

For executors, this transparency means being able to assess custody arrangements more accurately. But it also requires understanding technical distinctions between platforms that pool client assets versus those maintaining segregated custody.

Transfer of digital holdings under new regulated frameworks

The bill’s platform rules (Section 912BG) mandate clear procedures for depositing, redeeming, and directing delivery of assets “in their actual form (rather than their money’s worth)”.

For executors dealing with significant cryptocurrency or tokenised assets, this preserves the option of distributing actual assets to beneficiaries rather than just cash equivalents. The standardisation should also simplify managing assets across multiple platforms.

Potential impact for legacy systems: wills, executors, custody integration

Traditional estate planning tools weren’t designed for digital asset platforms with complex custody arrangements. The bill’s disclosure requirements help bridge this gap by mandating clear information about counterparty risks, asset recording methods, and platform rule changes.

For estate planners, these requirements create a standardised information framework. However, they also reveal the complexity of integrating digital assets with traditional inheritance mechanisms. The voting policy requirements add another layer; platforms must establish policies for exercising governance rights attached to underlying assets, affecting how executors manage staking rewards or governance tokens pending distribution.

Opportunities and Risks for Families & Platforms

Platforms gaining legitimacy vs burdened by compliance costs

The bill creates a pathway to regulatory legitimacy for digital asset platforms. Licensed platforms operating under the new standards framework should offer greater consumer protection and clearer legal structures.

But compliance costs will be significant. The bill’s standards requirements, disclosure obligations, and ongoing reporting needs favour larger, well-capitalised platforms. Smaller platforms may exit the market or consolidate.

For families, this consolidation might reduce choice but increase stability. Fewer platforms, but with stronger balance sheets and clearer regulatory oversight, could reduce the platform risk component of digital estate planning.

Estate planning firms needing to integrate regulated custody options

Estate planning professionals now face a choice: integrate digital asset platforms into their services or risk leaving clients exposed to regulatory gaps.

For advisors, the bill’s disclosure requirements create standardised information to work with. Platform rules, voting policies, and custody arrangements become transparent and comparable. However, the technical complexity remains significant, requiring new expertise in platform assessment and tokenised asset implications for inheritance strategies.

Risks if platforms fail or don’t comply

The bill’s transitional provisions (Part 8) allow existing platforms up to 18 months to obtain proper licensing. During this period, platform failure risks remain elevated.

Even after full implementation, the bill doesn’t eliminate platform risk – it just makes it more transparent and manageable. Licensed platforms can still fail, but the regulatory framework provides clearer processes for asset recovery and client protection.

For estate planning, this highlights the importance of platform diversification and understanding the specific protections available on each platform type.

What Needs to Happen for Real-World Impact

Adoption timelines and transitional provisions in the bill

The bill provides for commencement “the day after the end of the period of 12 months beginning on the day this Act receives the Royal Assent.” This gives the industry roughly 12-18 months from passage to prepare.

The transitional provisions create a two-stage implementation:

• First transition period: 6 months from commencement, during which existing platforms can continue operating while applying for proper licensing
• Second transition period: 12 months (extendable) during which licensed platforms must achieve full compliance with standards and disclosure requirements

This staged approach reduces market disruption but creates a period of regulatory uncertainty. Families with significant digital asset holdings should plan for potential platform changes during the transition period.

Need for interoperability with legacy estate systems

The bill doesn’t address integration with existing estate planning infrastructure; wills, probate processes, executor appointment mechanisms. This integration challenge remains for the industry to solve.

Professional bodies, technology providers, and platform operators need to develop standards for how digital asset platforms interact with traditional estate planning tools. Without this integration, the bill’s benefits for estate planning remain theoretical.

Role of education, industry standards, and tech vendors

The bill creates regulatory clarity, but implementation success depends on industry education and standardisation efforts. Estate planning professionals need training on digital asset platforms. Platform operators need guidance on compliance with new standards.

Technology vendors have a crucial role in developing tools that bridge the gap between digital asset platforms and traditional estate planning systems.

Suggested Actions for Families & Heirs

Audit your digital holdings and platform exposures

Document which platforms hold your assets and what custody arrangements they use. The bill’s new standards will affect different platform types differently.

Check platform compliance plans

Contact your platforms about their licensing timeline and how new standards might affect your holdings. Pay attention to smaller platforms that might exit the market.

Update your estate planning

Work with professionals who understand the new regulatory framework. Consider whether your documents adequately address digital assets held through regulated platforms.

Note on taxation: The bill doesn’t change existing tax obligations. Capital gains tax still applies to digital asset disposals, and inheritance tax considerations remain complex. The regulatory changes may affect record-keeping requirements and valuation methods, but the fundamental tax treatment of digital assets in estates requires separate professional advice.

Conclusion / Key Takeaways

The Treasury Laws Amendment Bill 2025 represents Australia’s most comprehensive attempt to regulate digital asset platforms. It creates clearer definitions, stronger consumer protections, and more transparent custody arrangements.

For estate planning, the bill is both opportunity and challenge. It provides the regulatory clarity needed to integrate digital assets into traditional wealth transfer planning. But it also reveals the technical complexity of digital asset custody and the skills gap in estate planning services.

The transition period over the next 12-18 months will be crucial. Platforms will need to obtain licensing, implement new standards, and provide clearer disclosure to clients. Families will need to reassess their digital asset strategies and ensure their estate planning adapts to the new regulatory reality.

The bill won’t eliminate all risks associated with digital assets in estate planning. But it should make those risks more transparent, manageable, and legally enforceable. For families with significant digital asset holdings, understanding these changes is essential for protecting intergenerational wealth transfer.

Audit your digital holdings and speak to a professional before the transition period begins. The regulatory landscape is shifting so ensure your estate planning shifts with it.

Disclaimer: This article is for general information only. It does not constitute legal, financial, tax, or professional advice. Readers should consult qualified professionals for decisions relating to digital assets or estate planning.