ASIC's Crypto Crackdown Intensifies: Appeals Federal Court Verdict

2

In a bold step, ASIC has contested the recent Federal Court ruling by Justice John Jackman, which found digital currency exchange Block Earner guilty of offering unlicensed financial services through its crypto-based Earner product. Despite acknowledging Block Earner's honest and non-negligent conduct, ASIC remains dissatisfied with the outcome.

According to ASIC, the Federal Court judge erred by suggesting that Block Earner depended on legal advice and also profited from its violations. The appeal highlights that regulatory ambiguity should not shield a company knowingly engaging in questionable activities for financial gain.

ASIC aims to overturn the initial judgment and seeks a penalty of $350,000, in addition to the costs incurred during the appeal process. This initiative is emphatic about ensuring stringent regulatory compliance in the financial services sector, particularly concerning burgeoning crypto products.

Notably, Block Earner operates under Web3 Ventures Pty Ltd, an AUSTRAC-registered currency exchange. However, it lacks an Australian Financial Services License (AFSL), a critical regulatory component according to ASIC.

On February 9, 2024, the court concluded that between March and November 2022, Block Earner had been providing unlicensed financial services and running an unregistered managed investment scheme through its fixed-yield product, Earner.

Conversely, the court dismissed ASIC's claims that Block Earner's variable yield crypto-assets offering, known as the Access product, required a financial services license and should be registered as a managed investment scheme.

This rigorous stance by ASIC comes at a time when crypto products are under intense scrutiny worldwide. The appeal underscores ASIC’s commitment to bringing clarity and compliance to the financial services space, leaving no room for regulatory evasion.

Published:Wednesday, 19th Jun 2024
Source: Paige Estritori

Share this news item:

Finance News

Clear

Increasing Number of Qualified Financial Advisers Opt Out of Practice 11 Jul 2025: Paige Estritori Recent analysis from WealthData indicates a growing trend among financial advisers in Australia, where a significant portion of those who have successfully passed the financial adviser exam are opting not to practice. As of now, 5,096 individuals, representing 33.31% of active advisers, have chosen not to proceed into practice after passing the exam—up from 28.36% a year prior. - read more

Melbourne's Housing Market: A Prime Opportunity For Buyers 11 Jul 2025: Paige Estritori The Reserve Bank of Australia (RBA) recently surprised many by maintaining the interest rate at 3.85%, against expectations of a cut. This decision is seen as a measure to continue moderating inflation, but it simultaneously delays potential spikes in the housing market, providing a favorable window for prospective homebuyers. In particular, Melbourne's current market presents significant value, offering a promising opportunity for those looking to enter the property market. - read more

Improving EOFY Planning: The Call for ATO Portal Access for Advisers 09 Jul 2025: Paige Estritori In a recent discussion, James O'Reilly, Director and Financial Planner at Northeast Wealth, underscored the benefits that could come from granting financial advisers access to the Australian Taxation Office (ATO) portal. Speaking on The ifa Show, O'Reilly proposed that this access would significantly simplify the services financial advisers provide to clients, particularly at tax time and the end of the financial year (EOFY). - read more

RBA Holds Rates Steady, Shocking Markets and Shifting Economic Expectations 09 Jul 2025: Paige Estritori The Reserve Bank of Australia (RBA) has decided to keep the official cash rate steady at 3.85%, taking many by surprise after expectations of a 25-basis-point cut had built up in financial circles. This unexpected move comes amid recent data indicating easing inflation and weaker than anticipated economic growth, conflicting with prior predictions of a cut. - read more

RBA to Continue Interest Rate Cuts Amid High Unemployment 08 Jul 2025: Paige Estritori The Reserve Bank of Australia (RBA) is anticipated to maintain its trajectory of incremental interest rate reductions, according to insights from leading financial analysts at ANZ. Recent data from the ANZ-Indeed Australian Job Ads series revealed a rise from 114.8 in May to 116.9 in June, suggesting a potential rebound in job advertisements after previous declines. Despite a stable unemployment rate and hours-based underutilisation rate since mid-2024, the Australian labour market remains strained. - read more

RBA Poised for Cash Rate Cut Amid Inflationary Trends 07 Jul 2025: Paige Estritori As the Reserve Bank of Australia (RBA) prepares for its forthcoming monetary policy announcement, economic analysts anticipate a further reduction in the official cash rate by 25 basis points. This prediction, supported by Finder’s RBA Cash Rate Survey, reveals that 88% of participating experts foresee a cut that would lower the interest rate to 3.6%, aligning the decision with the recent decline in both headline and core inflation to the central bank's target range of two to three percent. - read more