Australia’s financial regulator and watchdog is revising its posture on initial coin offerings (ICOs) and cryptocurrencies in the coming weeks, stressing that keeping an ‘open mind’ to new financial technologies will not come at the expense of ‘basic consumer protection‘ practices.
Speaking at a Sydney FinTech event with a number of blockchain and crypto-related companies in attendance on Thursday, Australian Securities and Investments (ASIC) Commissioner John Price specifically touched on how the regulator will engage with ICOs and cryptocurrencies.
In his speech, the regulatory official said the authority is ‘determined to see Australia’s fintech and regtech flourish in the right regulatory environment”. The same applies to its position on cryptocurrencies and ICOs, he added, although insisting that the “ASIC must be focused on both protecting Australian consumers and facilitating innovation across the financial services industry.”
In September 2017, the ASIC released an information sheet to provide guidance to businesses considering an injection of funds or fundraising through initial coin offerings (ICOs).
Depending on the type of token offered, ICOs can be deemed as a managed investment scheme, a share offering, an offer of a derivative or a non-cash payment facility, according to the information sheet.
The circumstances of the ICO in the way it is structured and operated will determine its legality, the sheet explains, warning ICO promoters of their obligation not to indulge in any misleading or deceptive conduct with potential investors. Stamping out deceptive practices, in particular, is “going to be a key focus for us going forward,” the ASIC commissioner said.
“I wanted to flag to you all this evening that we will be making some updates to the information sheet in the coming weeks,” Price said in his speech, notably stating that the document will “include more on cryptocurrencies” in its updated expansion.
We will highlight that Australian corporate and consumer law might apply – even if the ICO is created and offered from overseas. This is an important point given the international nature of this sector.
“There exists a perception that Australian regulations don’t apply or can be avoided by engaging in an activity from overseas,” he said later. “I cannot stress enough that if you are doing business here and selling something to Australians – including issuing securities or tokens to Australian consumers – our laws here can apply.”
Finally, the official reiterated that the ASIC – in its capacity as Australia’s corporate, markets and financial services regulator – will take a proactive and forward-looking approach to innovation.
“But, if there is one main thing I need you all to take away from ASIC tonight, it is we are dealing with real people’s money and ASIC’s support cannot come at the expense of basic consumer protection and the necessity to prevent investors and their funds being unfairly parted,” he said again, insisting the regulator will dedicate “a strong focus” on prohibiting misleading and deceptive conduct in the ICO space.
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Source : CryptoCoinNews