ASIC has released Consultation Paper 381 (CP 381), which outlines proposed updates to Information Sheet 225 (INFO 225) on digital assets and financial products and services. The proposed changes aim to provide greater clarity on how existing financial product definitions apply to digital assets, including 13 practical example
ASIC Commissioner Alan Kirkland emphasized the goal of fostering responsible financial innovation while ensuring consumer protection. He highlighted that Australia’s financial regulatory framework is broad and technology-neutral, meaning many digital assets are already considered financial products under current laws. ASIC’s draft guidance seeks to address stakeholder calls for clarity, with a transitional approach under consideration to allow the industry time to adapt.
The consultation process focuses on several areas, including:
- Updates to INFO 225, featuring detailed examples.
- Application of Australian Financial Services (AFS) licensing requirements to digital asset businesses.
- Licensing challenges for wrapped tokens and stablecoins, and the potential transition to the Government’s proposed reforms.
- Possible regulatory relief and a class “no-action” position for businesses navigating licensing processes.
Stakeholders are encouraged to provide feedback by 5pm on 28 February 2025. ASIC plans to finalize the updated INFO 225 by mid-2025 after considering the input. Meanwhile, it will continue to regulate the digital asset sector through guidance, licensing, compliance, and enforcement actions to safeguard consumers and maintain market integrity.
Background:
CP 381 targets a wide range of businesses involved in digital assets, including established financial firms exploring blockchain applications, new digital asset ventures, brokers, intermediaries, and their advisers.
INFO 225 was initially published in 2017 and updated in subsequent years, reflecting ASIC’s consistent position that many digital assets fall within the scope of financial products under current law. CP 381 aligns with the Government’s efforts to reform payment services and digital asset facilities. Investors can access ASIC’s MoneySmart website for information on the risks of investing in cryptocurrencies.
Have Your Say on the Future of Digital Asset Regulation!
ASIC is updating its guidance on digital assets and financial products to provide greater clarity and support for responsible innovation. We want your input!
✅ Share your feedback on proposed updates to INFO 225, including practical examples and licensing considerations.
✅ Help shape the regulatory framework for digital assets, stablecoins, and blockchain-based products.
Don’t miss this opportunity to influence the future of Australia’s digital asset industry Submit your feedback by 5pm, 28 February 2025. Talk to our crypto tax returns experts for more assistance with compliance for your crypto portfolio.
