Australia’s financial regulator, the Australian Securities and Investments Commission (ASIC), has expanded and clarified how existing financial services laws apply to digital assets, establishing clearer boundaries for companies operating in this rapidly evolving sector.
In a statement released on Wednesday, ASIC confirmed that its revised guidance, contained in an updated Information Sheet 225, sets out when digital asset products or services may be considered financial products under the Corporations Act. The update replaces earlier “crypto‑asset” terminology with “digital assets,” a broader term that encompasses virtual tokens, stablecoins, tokenised securities, and digital wallets.
The new guidance does not introduce new laws but aims to deliver regulatory certainty ahead of the federal government’s upcoming reforms for digital asset platforms and payment service providers. These reforms are expected to introduce formal licensing arrangements for exchanges, custodians, and stablecoin issuers later this year.
Stablecoins, wrapped tokens, and tokenised assets classified as financial products
Under ASIC’s updated approach, several categories of digital assets, including stablecoins, wrapped tokens, tokenised securities, and digital asset wallets, are now explicitly recognised as financial products. This means that entities offering these products to Australian consumers must obtain an Australian financial services licence (AFSL).
ASIC Commissioner Alan Kirkland said the guidance was developed to respond to industry requests for clarity while reinforcing consumer protections.
“Distributed ledger technology and tokenisation are reshaping global finance,” Kirkland said. “ASIC’s guidance provides the regulatory clarity that firms have been calling for to innovate confidently in Australia.”
He added that recognising digital assets as financial products ensures consumers benefit from the same protections as in traditional finance and gives ASIC the authority to act when “poor practices lead to harm.”
Transitional support and proposed relief measures
Acknowledging that firms will need time to adjust to the updated regulatory expectations, ASIC introduced a sector‑wide no‑action relief measure lasting until 30 June 2026. This allows businesses to continue operating while they assess their obligations and apply for appropriate licences.
Alongside this, ASIC has proposed targeted regulatory relief for:
- Distributors of stablecoins and wrapped tokens, and
- Custodians managing digital‑asset financial products.
Public consultation on the proposed relief is open until 12 November 2025, giving industry stakeholders an opportunity to provide feedback before final measures are implemented. ASIC stated that these proposals were shaped by submissions to its earlier consultation paper, CP 381 – Updates to INFO 225: Digital Assets: Financial Products and Services, which outlined how existing legislation applies to digital assets.
Oversight of offshore and DeFi entities
A key update in ASIC’s guidance is the confirmation that Australian financial law applies to offshore or decentralised entities that serve Australian customers. This effectively closes regulatory loopholes that some global crypto platforms have used to avoid oversight.
The regulator also extended its guidance to cover new examples, including staking programs, yield‑bearing stablecoins, gaming NFTs, and tokenised real‑estate products. In each case, ASIC outlines how the product may qualify as a managed investment scheme, derivative, or non‑cash payment facility, depending on the rights and benefits it provides.
Part of a broader national effort
ASIC’s revised guidance forms part of Australia’s broader national strategy to bring digital assets fully within the scope of financial regulation. It follows recent moves by the Treasury, such as draft laws proposing licensing requirements for digital‑asset platforms, and by AUSTRAC, which has increased oversight of cryptocurrency ATMs and other services.
By aligning rules for the crypto sector with existing financial laws, the Australian government aims to balance innovation with consumer protection. Kirkland noted that ASIC will continue to evolve its approach alongside Treasury’s legislative reforms but reiterated that entities should already be preparing to comply with existing obligations.
“We recognise that firms will need time to consider the updated guidance and apply for licences,” Kirkland said. “Licensing ensures consumers receive the full suite of protections under the law and allows ASIC to act when poor practices lead to harm.”
A clearer path forward for digital asset regulation
The updated framework marks a significant step in establishing transparent and enforceable guardrails for digital‑asset businesses in Australia. With the combination of clear licensing requirements, transitional support, and industry consultation, ASIC’s initiative aims to bring stability and legitimacy to the country’s crypto ecosystem, positioning Australia as one of the leading jurisdictions advancing practical digital‑asset regulation while supporting responsible innovation.
Tanya Petrusenko
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