Australia’s financial regulator, the Australian Securities and Investments Commission (ASIC), has released updated guidance clarifying that existing financial services laws now apply to a broader range of digital assets. In a Wednesday statement, ASIC confirmed that products such as stablecoins, wrapped tokens, tokenized securities, and digital asset wallets are considered financial products under current law. This classification is a significant regulatory step, meaning that companies offering these products will now be required to obtain a local financial services license (AFS license) to operate legally in Australia.
ASIC Commissioner Alan Kirkland emphasized the importance of this move, stating that many widely traded digital assets already fall under financial product definitions and will remain so under the government’s proposed law reform. Kirkland explained that this licensing requirement is crucial because it “ensures consumers receive the full suite of protections under the law and allows ASIC to act when poor practices lead to harm.” This approach aligns with the regulator’s focus on extending consumer safeguards to the digital asset ecosystem.
To allow businesses time to adapt to the new requirements, ASIC is granting a sector-wide “no-action” relief until June 30, 2026. This transitional period is intended to give firms sufficient time to assess the updated guidance, understand its implications, and apply for the necessary licenses. Furthermore, the regulator has proposed specific relief measures for distributors of certain stablecoins and wrapped tokens, as well as for custodians of digital asset financial products, responding to industry feedback that sought further clarification on the treatment of these assets.
The updated guidance follows months of consultation, including a consultation paper released in December 2024 seeking industry feedback. This move is part of Australia’s broader effort to create a clear and robust regulatory framework for crypto assets. Earlier steps in this direction include a class exemption announced in September that eased licensing rules for certain stablecoin intermediaries. Most recently, Australia’s Treasury proposed draft legislation that would require crypto exchanges and certain service providers to hold financial services licenses, collectively moving the country toward a more regulated digital asset environment.
