The Australian Federal Court has delivered a significant ruling in favour of Block Earner, a crypto lending platform, marking a pivotal moment for the digital asset industry in Australia. The decision, handed down in Sydney, represents a major setback for the Australian Securities and Investments Commission (ASIC), which had accused the lender of operating an unlicensed financial services business.
The case centred on whether the crypto lender’s products should be classified as financial products under Australian law. ASIC argued that the platform’s lending and interest-earning services constituted managed investment schemes requiring a financial services licence. The Federal Court disagreed, finding that the products did not meet the legal definition of a managed investment scheme. This ruling effectively cleared the lender of operating without a licence.
This decision sets a precedent for regulating crypto lending products in Australia. Legal experts say the ruling provides greater clarity for crypto businesses and investors, potentially encouraging further innovation in the sector. However, some analysts warn that the judgment may prompt ASIC to seek legislative changes to strengthen its oversight of digital asset products.
The crypto community has welcomed the ruling, viewing it as a positive step for regulatory certainty. Industry leaders argue that clear legal boundaries are essential for the responsible growth of blockchain finance in Australia. Meanwhile, ASIC has stated it is reviewing the judgment and considering its next steps, signalling that the regulatory debate is far from over.
Notably, Australia plans to introduce new regulations for crypto exchanges and stablecoin issuers, integrating them into existing financial service laws. A policy paper from the Treasury outlines that these platforms must obtain an Australian Financial Services Licence to manage risks, foster innovation, protect consumers, and maintain market integrity. While smaller platforms may have some exemptions, stablecoins used for payments will be subject to oversight, similar to traditional payment systems.
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