ASIC: We’ll be watching ICOs and cryptocurrency carefully

Posted: 7 September 2018 6:22 pm
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First do no harm remains the rule of the day.

In its 2018 to 2022 corporate plan, ASIC has reaffirmed its intentions to keep a close watch on the cryptocurrency space, especially ICOs and other token offerings.

The focus is still on minimising consumer harm, rather than broad crackdowns of the space as a whole, and will be focused on ensuring that all coin offerings are done above board.

Beyond this, the plan also outlines a closer look at regtech in the coming years, and a greater focus on technology and digitisation of systems. It will also be monitoring the outcomes achieved by the ASX's blockchain replacement of the old CHESS system.

"We will continue to focus on monitoring threats of harm from emerging products (e.g. ICOs and crypto currencies), cyber resilience, the adequate management of technological solutions by firms and markets, and misconduct that is facilitated by or through digital and/or cyber-based mechanisms," it described some of its risk reduction plans.

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Many of the actions in the cryptocurrency and ICO space are re-affirmations of previous commitments, including its intention to focus on a "first do no harm" type approach to regulation, as a balance between consumer protection and promoting innovation.

"If you are acting with someone else’s money, or selling something to someone, you have obligations. Regardless of the structure of the ICO, there is one law that will always apply: you cannot make misleading or deceptive statements about the product. This is going to be a key focus for us as this sector develops," ASIC chairman John Price has previously said.

The same rules apply to Australian ICOs, as well as overseas ICOs targeting Australian customers.

Significantly, the new report also points at plans to bring cryptcocurrency exchanges more in line with other financial services. As a new project from 2018-2019, the regulator says, it will be "developing [its] approach for applying the principles for regulating market infrastructure providers to crypto exchanges."

Disclosure: At the time of writing the author holds ETH, IOTA, ICX, VET, XLM, BTC, ADA

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

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