ASIC's Longo pledges action against certain ‘high-risk’ crypto products
Australia’s financial services and markets regulator has issued another glaring warning towards issuers of crypto-based financial products, particularly those inappropriately marketing high-risk products.
Joe Longo, chair of the Australian Securities and Investment Commission (ASIC) in an opening speech at the ASIC annual forum on Nov. 3 local time said it will use current laws to police “risky and complex products” to protect consumers.
He added, “crypto and the crypto ecosystem continue to pose challenges and opportunities for regulators and policymakers alike” saying the risks with crypto investing are “often opaque” with the assets being “highly volatile, inherently risky, and complex.”
While his warning encompassed non-crypto-focused firms too, Longo took particular aim at issuers of crypto-based financial products, putting them on notice if their offering doesn’t pass ASICs muster:
We’re seeing issuers promoting high-risk products as appropriate investments that will make up a significant portion of an individual consumer’s investment portfolio. This will not be tolerated and action will be taken," he warned.
Longo said ASIC is continuing to use rules enacted in Oct. 2021 for financial products to have stricter target market determinations (TMDs) and disclosures of significant dealings outside of those TMDs to police “risky, volatile, and complex products.”
ASIC recently used these powers on Oct. 17, halting three cryptocurrency-related funds set to be offered to retail investors, due to non-compliant TMDs saying to Cointelegraph that they were “too broad [...] given the volatility and speculative nature of crypto markets.”
Longo took a seemingly softer approach towards blockchain and asset tokenization technology,
Read more on cointelegraph.com
