ASIC hopes its new guidelines will help regulate ICOs and crypto assets
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New guidelines regarding the legal obligations for initial coin offerings (ICOs) and crypto assets from ASIC should help regulate the fledgling sector, the government body hopes.
The Australian Securities and Investments Commission (ASIC) has offered new guidance for companies hoping to use ICOs, following a treasury paper in January that found many ICOs turned out to be scams.
Designed to be read by entities considering raising funds through an ICO or involved with crypto-assets such as cryptocurrency, tokens or stable coins, Information Sheet 225 has been designed to offer businesses guidance on whether they’re following the Corporations Act while doing so.
In January 2019, the Treasury noted that many ICOs have turned out to be scams. Businesses seeking to operate lawfully and legitimately need to distinguish themselves from possible scams and carefully consider the information, ASIC said.
“Businesses offering crypto-assets, or offering services in relation to crypto-assets, need to undertake appropriate inquiries to satisfy themselves they are complying with all relevant Australian laws,” said ASIC commissioner John Price.
“As a minimum, regardless of whether a financial product is involved in the fundraising, the prohibitions against misleading or deceptive conduct under Australian Consumer Law apply.
“Australian laws will also apply even if the ICO or crypto-asset is promoted or sold to Australians from offshore. Issuers of ICOs, crypto-assets and their advisers should not assume the use of these structures means that key consumer protections under Australian laws do not apply or can be ignored.”