What happened?
Australia’s securities regulator, ASIC, ruled that stablecoins, wrapped tokens, tokenized securities and digital asset wallets are financial products under existing law and therefore require providers to hold Australian Financial Services (AFS) licences. ASIC issued updated guidance, a sector-wide no-action position until June 30, 2026, and an eight-month transition window while consulting on draft relief for certain stablecoin intermediaries. The move aligns with broader government reforms that would impose tough penalties and bring exchanges, custodians and tokenized platforms under the Corporations Act.
Who does this affect?
Crypto exchanges, custodians, wallet providers, stablecoin issuers and distributors, and platforms offering tokenized securities will now need to get AFS licences or meet specified relief conditions. Large global players like Coinbase and Kraken, local issuers such as Catena Digital, retirement services targeting SMSFs, and institutional participants in projects like the Reserve Bank’s Project Acacia are all directly in scope. Smaller platforms with minimal customer balances or low transaction volumes may be exempt, but most businesses and retail investors using these products will see new disclosure, custody and compliance rules.
Why does this matter?
Reclassifying digital assets as financial products raises compliance costs and creates higher barriers to entry, which could push some smaller firms out while strengthening regulated incumbents. At the same time, clearer rules and stronger consumer protections may boost investor confidence, accelerate institutional adoption, and help tokenized assets integrate with mainstream finance, including pension funds and CBDC work. With tough penalties and licensing requirements on the table, business models and market structure are likely to change, so the stablecoin and tokenization market’s growth will hinge on how quickly firms adapt.