The Australian Securities and Investments Commission (ASIC) has published a new advisory updating its guidance on digital assets and related financial products. The regulator aims to provide greater clarity on how the current financial product definition applies to cryptocurrencies.
Updates to Crypto Guidance from ASIC
ASIC has today published Advisory Paper 381 (CP 381), which outlines updates to Information Sheet 225 (INFO 225). These products will clarify whether some traditional market rules also apply to crypto assets.
“We want to ensure consumer protection while encouraging the growth of responsible financial innovation. “A well-regulated financial system benefits everyone in the community because it supports consumer confidence, market integrity, and facilitates competition and innovation.”
ASIC Commissioner Alan Kirkland highlighted the importance of striking a balance between responsible financial innovation and consumer protection.
Crypto Industry Has Been Criticized
Crypto industry experts have stated that compliance with new regulatory rules will no longer be optional and market players will keep a close eye on it. Some experts worry that ASIC’s draft guidance could leave crypto startups vulnerable, leading to firms leaving Australia.
“Updated guidance could make starting a crypto business in Australia ‘as costly, if not more, than starting overseas’.”
Crypto lawyer Joni Pirovich stated in a statement on LinkedIn that high compliance costs could put local businesses in a difficult situation.
Changes in Digital Asset Regulations
Australia’s digital asset market is changing with global developments and the emergence of crypto ETFs. As clarity in the region’s digital asset regulations increases, asset manager Monochrome is offering Ethereum in line with increasing demand in the local market. $3,727 He launched his ETF.
Additionally, the Circle company has teamed up with venture capitalist Mark Carnegie’s MHC Digital Group as it expands its USDC stablecoin operations to Australia. This partnership aims to increase the availability and accessibility of USDC in the region.
ASIC will receive feedback on these updates by 28 February 2025 and, based on comments received, will publish the final version of INFO 225 in mid-2025. The regulator will continue to use its regulatory tools to protect consumers and maintain market integrity in the digital asset space.
As a result, updates to ASIC’s digital asset guidance, while aimed at facilitating the integration of financial products into the crypto market, have been criticized by some smaller market players. Although clarification of regulations is positive for the market, increased compliance costs may cause some companies to shift abroad.
Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that crypto currencies carry high volatility and therefore risk, and should carry out their transactions in line with their own research.
