Tracking ASIC’s 2023 enforcement priorities one year on: Crypto assets

Written By

jonathon ellis Module
Jonathon Ellis

Partner
Australia

I'm a dispute resolution and regulatory investigations partner in our Sydney office. I work with clients to solve complex issues facing their businesses, whether that is a commercial dispute or engagement with regulatory agencies.

madelaine morgan Module
Madelaine Morgan

Associate
Australia

I am an associate in the Dispute Resolution Group in Sydney, specialising predominantly in commercial disputes.

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Henry Wrench

Senior Associate
Australia

I am a senior associate in the Dispute Resolution team at Bird & Bird specialising in commercial, corporate, contractual and insolvency litigation.

For 2023, ASIC included “misconduct involving high risk products including crypto assets” in its list of enforcement priorities. This foreshadowing of action against non-compliant crypto businesses became a reality for a small number of companies who have been the recent subjects of enforcement action by ASIC. These businesses include Web3 Ventures Pty Ltd trading as Block Earner; Bobbob Pty Ltd; Bit Trade Pty Ltd which operated the Kraken crypto exchange; Helio Lending Pty Ltd; and Oztures Trading Pty Ltd, the Australian subsidiary of the now-infamous exchange, Binance.

This article looks closely at the first judgment obtained by ASIC against a crypto business –Block Earner.

The decision of Jackman J of Australia’s Federal Court in Australian Securities Investment Commission v Web3 Ventures Pty Ltd [2024] FCA 64 represents the corporate regulator’s first successful case against a business operating in the crypto industry, and for this reason, warrants close attention for any businesses operating in this space.

The matter is currently adjourned pending a further hearing on the issue of penalties to be imposed on Block Earner.

The Block Earner Business

Block Earner was founded in 2021 in Australia and operated products on its online platform, including:

  • The “Earner product” from around 17 March 2022 to 16 November 2022. Users of the Earner product could access through Block Earner’s online platform the Aave and Compound DeFi lending protocols which operated on the Ethereum blockchain.
  • The “Access product” from around March 2022 to at least the date of the final hearing. Users of the Access product were able to lend cryptocurrency…

Full article available on Disputes +

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