Australia Grants Transition Period as ASIC Clarifies Crypto Must Be Financial Product

Market Context

Australia has been moving to tighten its regulation of digital assets. Draft legislation on digital asset platforms and tokenised custody is underway, while industry participants have pushed for clarity on how existing financial services laws apply to crypto. This update gives firms time to prepare before stricter licensing obligations kick in. 

Technical Details with Attribution

• On October 29, 2025, the Australian Securities and Investments Commission (ASIC) published updated guidance confirming that many crypto-asset types are considered financial products under the Corporations Act. 
• The guidance revises Information Sheet 225 to clarify when digital assets qualify as financial products. 
• ASIC has granted a sector-wide “no-action position” until June 30, 2026, allowing firms time to apply for required financial services licences (AFSL). 
• Licensing applies to a wide range of activities: stablecoin issuers, wrapped token providers, tokenized securities platforms, custody / wallet intermediaries. 
• ASIC invited feedback on draft relief instruments; public consultation is open until November 12, 2025. 

Analyst Perspectives 

Some observers believe ASIC’s clarity and transition period strikes a balance between innovation and consumer protection. It may help firms prepare compliance frameworks without abrupt disruption.

However, other analysts caution that the temporary relief may mask substantial compliance costs ahead, and smaller firms may struggle with licensing burdens once the transition period ends. The effectiveness will depend on how ASIC enforces rules post-June 2026 and how costly license applications prove to be.

Global Impact Note

Australia’s move echoes a global trend of regulators treating certain crypto operators similarly to traditional finance. Similar licensing regimes are being considered or implemented in jurisdictions such as the EU, the UK, and parts of Asia. This could raise the bar for crypto-firms globally and influence how tokenised-asset projects structure operations and growth strategies.