Share market operator ASX says start-up businesses will list overseas if they can't legally crowd fund in Australia.
Former Commonwealth Bank boss David Murray's financial system inquiry last year recommended that internet and social media fundraising be regulated.
Australian Securities Exchange chief executive Elmer Funke Kupper on Thursday said Australia would lose out if this form of venture capitalism, known as crowd funding, wasn't allowed locally.
"If we don't have those markets here, they will get the money somewhere else and if they get the money somewhere else, they will list somewhere else," he told reporters, adding the ASX had no plans to start up its own crowd funding business.
Crowd funding is a form of capital raising using special websites open to investors.
It's gaining popularity in the United States but in Australia, local websites aren't regulated.
Mr Funke Kupper is also calling for simplified disclosure requirements for larger listed companies that issue corporate bonds, which the Murray inquiry also recommended.
"There's a big market for this stuff if you get it to the retail investor," he said.
"It is simply too hard and too expensive to issue corporate bonds in this country and therefore people don't do it."
ASX has unveiled a net profit of $198.6 million for the six months to December 31, marking a rise of 4.7 per cent from $189.6 million for the corresponding period in 2013.
ASX's Austraclear business, which provides settlement, depository and registry services for Australian dollar debt securities including government and corporate bonds, posted a half year revenue increase of nine per cent.
By comparison, the ASX's largest derivatives business posted a more modest revenue increase of 3.3 per cent.
ASX shares closed 49 cents lower at $39.65.
A SECURE SET OF NUMBERS
* Net profit of $198.6m, up 4.7pct from $189.6m
* Revenue of $348.7m, up 5.9pct from $329.3m
* Fully franked interim dividend of 92.3 cents per share, up from 88.2 cents
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