The ASIC classified several digital assets as financial products.
According to specialists in the field, smaller enterprises can face difficulties.
According to the proposed guidelines put forth by the Australian corporate regulator, crypto exchanges and businesses dealing with digital assets would no longer be able to escape expensive licensing.
In a consultation document on new crypto guidelines issued on December 4th, the Australian Securities and Investment Commission (ASIC) classified several digital assets as financial products and made it clear that the majority of companies dealing in crypto needed licenses.
Burden on Small Players
Platforms that enable the trading of financial products may furthermore need an Australian Market License. Whereas enterprises providing financial services or dealing in financial products require an Australian Financial Services License (AFSL).
Many additional crypto businesses, including exchanges, would be required under the new guidelines to get one of these licenses. Crypto businesses may be left high and dry by ASIC’s proposed guidelines, according to those who are worried about a possible outflow of crypto enterprises from Australia.
The larger companies will naturally have the resources to weather the storm of regulation, legal fees, and compliance costs. According to specialists in the field, smaller enterprises can face difficulties.
In terms of market sentiment, anything that clarifies regulations is welcome. Despite the harshness, the regulator has provided much-needed clarification for crypto, so there is some good news. This piece of regulatory advice is huge for the market, according to another specialist in the field. Stablecoins, native token staking services, exchange tokens, and wrapped tokens are all being seriously considered as potential new financial products and services by ASIC.
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