As the cryptocurrency market is coming back to life and new institutions and individuals are entering the scene, Australian Security and Investments Commission releases Information Sheet 255, guidance on the regulatory implications for industry participants.
Who Is Affected?
Information Sheet 255 should be relevant to all sorts of direct and indirect market participants. This involves ICO issuers, payment system intermediaries, crypto miners, exchanges, trading platforms, merchant service providers, and other key players in the industry.
ASIC reference to cryptocurrency assets involves cryptocurrency, tokens (usually issued during an ICO), and stablecoins.
Furthermore, ASIC defines crypto as “a digital representation of the value of rights, the ownership that is evidenced cryptographically and that is held and transferred electronically by some type of distributed ledger technology or another distributed cryptographically verifiable data structure.”
Based on this definition, the industry participants should assess their current arrangement related to crypto-assets, map out and document their products and services, and consider if they should make any changes to their services or products to continue to meet obligations.
ASIC proceeds to define the moment a crypto asset becomes a financial product. Tokens issued via ICO will be considered ‘securities,’ and an ICO may include derivatives. ASIC gives further guidance on offering retail investors exposure to crypto assets via standardized investment methods.
ASIC also clarifies that Australian laws may continue to apply even if the offshore, decentralized, or other structures were to trade, issue, or sell crypto assets in Australia.