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The Australian Securities and Investments Commission has released a consultation paper outlining proposed updates to its guidelines for digital assets, inviting industry feedback and aiming for enhanced clarity.
On December 4, 2024, the Australian Securities and Investments Commission (ASIC) released Consultation Paper 381 (CP 381), outlining significant proposed updates to its existing guidance on digital assets, previously known as Information Sheet 225 (INFO 225). The updates aim to provide enhanced clarity and additional examples to stakeholders engaging with crypto- and digital asset products and services, while also inviting feedback from industry participants.
INFO 225 has served as a pivotal resource for entities offering products or services related to digital assets, aiding in identifying when such offerings may classify as financial products requiring appropriate licensing. This move to revise the guidance comes in response to the rapid expansion and evolution of the digital asset landscape. ASIC has recognized the necessity of aligning regulatory frameworks with these developments, emphasizing the need for up-to-date guidance reflective of contemporary offerings.
Among the key proposals in CP 381 is a change in terminology, shifting from “crypto-assets” to “digital assets.” ASIC argues that this broader terminology encompasses a wider array of financial arrangements, including interests in managed investment schemes and tokenized versions of traditional financial products, such as securities. This rebranding is a strategic approach towards evolving regulations designed to accommodate the variations within the digital asset market.
Notably, CP 381 suggests the inclusion of worked examples within INFO 225 to facilitate a better understanding of regulatory interpretations. The examples cover a diverse range of scenarios, such as exchange tokens, non-fungible tokens (NFTs) used in gaming, yield-bearing stablecoins, and tokenized securities. While this illustrative approach may help clarify regulatory expectations, ASIC has noted that the examples are not comprehensive.
The consultation process also highlights ASIC’s intention to support businesses transitioning under the new guidelines. To that end, CP 381 proposes a transitional relief framework for digital asset businesses actively seeking licensing. Eligibility criteria include being operational at the time of the consultation and having submitted a license application to ASIC. However, specific financial products like futures and derivatives are excluded from this transitional relief, although such exclusions may be revisited based on stakeholder feedback.
Additional updates proposed by ASIC in CP 381 aim to refine the guidance on making financial investments, reduce emphasis on initial coin offerings (ICOs), and extend good practice guidelines to custodial and depository service providers. By finalizing the amendments to INFO 225 by mid-2025, ASIC seeks to clarify existing regulatory obligations without altering the fundamental requirements imposed on entities.
ASIC is collecting feedback from industry actors until February 28, 2025, with a view to ensuring that the updated guidelines are beneficial and relevant to all stakeholders involved in the burgeoning digital asset ecosystem.
The 119th U.S. Congressional session begins with hopes for clearer regulatory frameworks in the crypto sector, following the election of pro-crypto lawmakers.
Authorities around the globe are intensifying their efforts to address the increasing prevalence of...
As policymakers focus on digital asset regulation globally, the Cayman Islands emerges as a leader with innovative frameworks and compliance measures, setting a precedent for other jurisdictions.
The integration of AI technologies with decentralized systems presents opportunities and challenges, as sectors prepare for the potential impact of autonomous robots.