Earner product won’t make a return Despite the win in court, Block Earner will not be reviving its Earner product after axing it when legal proceedings began, but Coombes said that “crypto-backed loans products remain the core focus of the company.”“Regulation going forward is not an easy task, and we empathise with the regulators on this point,” Coombes added.“We hope a collaborative process can bring about positive change.” Related: Australia outlines crypto regulation plan, promises action on debankingASIC launched civil legal proceedings in November 2022, arguing that Block Earner needed an Australian Financial Services License to offer its three crypto-linked fixed-yield earning products.
The Federal Court of Australia has sided with fintech firm Block Earner in an appeal against a ruling that found it was required to hold a financial services license for its now-discontinued crypto-related products. Block Earner’s crypto-linked fixed-yield earning product is not a financial product, or a managed investment scheme, and is not a derivative under the Corporations Act, Justices David O’Callaghan, Wendy Abraham and Catherine Button said in an April 22 judgment. The trio said Block Earner’s yield product couldn’t be classed as an investment or financial product because users loaned crypto under fixed terms for interest payments and didn’t pool contributions to generate further benefits.
The regulator said in an April 22 press release that it is currently “considering this decision.”Block Earner’s chief commercial officer, James Coombes, told Cointelegraph the court decision brings clarity that crypto assets shouldn’t be treated differently from other asset classes when applying existing laws. “Our product was simply defined as one where customers would lend their assets to us for a fixed return, there was no share in the upside of the pool of assets and as such no Managed Investment Scheme existed,” he said. “The fact that it included crypto assets should not alter that simple definition, and I believe this case forms a bedrock for ambitious brands around Australia to build from.”An ASIC spokesperson declined further comment.
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Author / Journalist: Cointelegraph by Stephen Katte
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