Australian Judge Hands Split Decision in Market’s Regulator vs Block Earner

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  • Fin­tech com­pa­ny Block Earn­er engaged in unli­censed ser­vices by offer­ing its cryp­to-backed Earn­er prod­uct, ruled an Aus­tralian Fed­er­al Court.

  • The court though, hand­ed Block Earn­er a part vic­to­ry against Australia’s mar­kets reg­u­la­tor by adju­di­cat­ing that its DeFi “Access” ser­vice was not illegal.

An Aus­tralian court has giv­en a split deci­sion in a case brought by Australia’s mar­kets reg­u­la­tor against Syd­ney-based cryp­to start-up Block Earner.

Judge Ian McNeil Jack­man, who is also the broth­er of actor Hugh Jack­man, ruled on Fri­day that Block Earn­er engaged in unli­censed finan­cial ser­vices con­duct when offer­ing its cryp­to-backed Earn­er product.

How­ev­er, Jack­man dis­missed alle­ga­tions relat­ing to Block Earner’s DeFi “Access” ser­vice. The court will deter­mine the fine Block Earn­er will have to pay dur­ing a sched­uled hear­ing on March 1, 2024.

The Aus­tralian Secu­ri­ties and Invest­ments Com­mis­sion (ASIC) sued Block Earn­er, alleg­ing the fin­tech com­pa­ny pro­vid­ed a range of unli­censed fixed-yield earn­ing prod­ucts based on cryp­to assets in Novem­ber 2022. In the same month, Block Earn­er, which has back­ing from cryp­to exchange Coin­base, vol­un­tar­i­ly with­drew its fixed-yield “Earn­er” service.

ASIC Deputy Chair Sarah Court said, “This impor­tant deci­sion pro­vides some clar­i­ty as to when cryp­to-backed prod­ucts should be con­sid­ered finan­cial prod­ucts which require licens­ing under the law.”

“Block Earn­er can con­tin­ue offer­ing Access, and the case pro­vides guid­ance for oth­er cryp­to busi­ness­es high­light­ing ’a pos­i­tive step for­ward’ that ‘pro­vides a glimpse into a future where DeFi can thrive,” the com­pa­ny said in an announce­ment.

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