The ASIC Block Earner case has moved to a new phase. On May 21, the Australian Securities and Investments Commission (ASIC) said it would seek special leave from the High Court of Australia.
The goal is to appeal an earlier ruling that went in favor of the fintech firm Block Earner.
ASIC wants the High Court to review how Australian law defines a financial product.
The request follows the Federal Court’s April 22, 2024 ruling that found Block Earner’s crypto-linked fixed-yield product is not a financial product, a managed investment scheme, or a derivative.
In its statement, ASIC explained,
“The definition of financial product was drafted in a broad and technology-neutral way, and ASIC believes it is in the public interest to clarify this.”
The Block Earner High Court appeal aims to clarify how the law applies to digital assets, including interest-earning services and the conversion of one asset type to another. ASIC said this affects all sectors and is not limited to crypto.
Federal Court Rejected ASIC Crypto Yield Ruling
The ASIC crypto yield ruling was first challenged in the Federal Court. Judges David O’Callaghan, Wendy Abraham, and Catherine Button ruled that Block Earner did not need a financial license for its fixed-yield crypto product.
This service ran from March 17, 2022, to November 16, 2022 before being voluntarily shut down.
According to a Block Earner legal update shared with Cointelegraph, the company stated,
“This has escalated to a broader legal question around the definition of a financial product, which extends well beyond Block Earner and the crypto sector.”
The company added that the April ruling was sound and confirmed it would respond to ASIC’s application through the appropriate legal channels.
The Federal Court’s decision marked a key moment in the broader conversation about Australia crypto regulation, especially around fixed-yield products linked to crypto assets.
Block Earner Legal Update Shows Timeline of Case Since 2022
The ASIC Block Earner case started in November 2022, when the regulator filed legal action. ASIC argued that Block Earner needed an Australian Financial Services (AFS) license to operate its product.
In February 2024, the Federal Court supported ASIC’s claim about the licensing requirement.
However, in June 2024, the court declined to impose any penalties. It ruled that Block Earner had acted “honestly” and obtained legal advice before launching its fixed-yield product.
Block Earner responded by filing an appeal on July 9, 2024, to challenge the earlier decision requiring a license. ASIC then announced its own plan to seek a Block Earner High Court appeal, focusing on the financial product definition.
The timeline of events shows a long legal process involving multiple rulings and appeals from both sides.
The legal issues now center around how Australia’s Corporations Act defines a financial product, especially when applied to crypto-linked services.
ASIC Says Case Raises Public Interest in Crypto Regulation
ASIC confirmed that it is seeking special leave to move forward with its Block Earner High Court appeal. In Australia, the High Court only hears appeals that involve major legal questions or issues of public interest.
ASIC said the outcome will affect all financial services, regardless of whether they involve crypto assets.
The agency emphasized that the appeal is about defining financial products clearly under the law.
Until the High Court decides whether to accept the case, the ASIC crypto yield ruling and related legal questions remain unresolved.
The Australia crypto regulation debate continues as both ASIC and Block Earner wait for the next legal step.
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