Crypto News Today: Australia Labels Stablecoins and Wrapped Tokens as Financial Products

Australia now classifies stablecoins and wrapped tokens as financial products under updated ASIC guidance, requiring provider licenses.

The Australian Securities and Investments Commission (ASIC) has released updated guidance confirming that stablecoins, wrapped tokens, and similar digital assets are now classified as financial products. The changes apply under existing financial laws, meaning providers must obtain proper licenses to offer such services within the country.

ASIC Expands Financial Product Definition to Cover Key Digital Assets

ASIC announced that stablecoins, wrapped tokens, tokenized securities, and digital asset wallets are considered financial products under the current law. This classification requires that companies offering these services obtain a local financial services license. The update follows months of consultation with industry stakeholders.

ASIC Commissioner Alan Kirkland stated that many popular digital assets fall within the definition of financial products and will remain so under proposed reforms.

“Licensing ensures consumers receive the full suite of protections under the law,” he said in a statement.

The regulator added that these changes are for improving market oversight and reducing harm to users.

This new guidance builds on previous regulatory efforts, including a September exemption that allowed certain licensed intermediaries to distribute stablecoins without needing separate regulatory approval. The latest guidance sets a clearer path for how businesses must comply with Australia’s financial laws when dealing with crypto assets.

Temporary Relief Granted as Industry Adjusts to Regulatory Changes

ASIC is allowing a sector-wide no-action relief period until June 30, 2026. This gives companies time to understand the new requirements and apply for the necessary licenses. The relief helps prevent disruption as the market adopts the updated framework.

The regulator also proposed targeted relief for distributors of certain stablecoins and wrapped tokens, as well as custodians of digital asset financial products.

ASIC said these measures respond directly to feedback received from its December 2024 consultation paper. During that period, many companies sought clarity on regulations for stablecoins and wrapped tokens.

Companies offering these digital assets must now begin internal assessments to determine whether their products fall under the updated definition. Failure to comply after the relief period may result in enforcement actions, as the ASIC will have full authority to intervene in unlicensed activity involving financial products.

Broader Efforts Toward Regulating Crypto Services in Australia

This move is part of a larger regulatory effort in Australia to bring more structure to the digital asset industry. Last month, the Treasury released draft legislation that would require crypto exchanges and other service providers to hold a financial services license.

ASIC’s updated guidance complements these legislative efforts and aims to bring more consistency to how digital assets are treated under financial law. It also allows regulators to take action against poor practices in the industry while ensuring consumer protection remains a priority.

Australia’s evolving crypto regulation reflects growing interest in aligning with global standards. As crypto products become more integrated into financial systems, regulators are working to apply existing laws in a way that fits new technologies.

Companies now face a clearer framework for operating digital asset services in the Australian market.