Australia classifies stablecoins, wrapped tokens as financial products in updated guidance

Australia's financial regulator has released an updated version of its guidance clarifying how the country's existing financial services laws apply to digital assets.

The Australian Securities and Investments Commission (ASIC) said in a Wednesday statement that it now considers products such as stablecoins, wrapped tokens, tokenized securities and digital asset wallets as financial products. Companies therefore need a local financial services license to offer such products.

"Many widely traded digital assets are financial products under current law — and will remain so under the Government’s proposed law reform — meaning many providers require a financial services license," said ASIC Commissioner Alan Kirkland. "Licensing ensures consumers receive the full suite of protections under the law and allows ASIC to act when poor practices lead to harm."

Specifically, ASIC is granting a sector-wide no-action relief until June 30, 2026, to give businesses time to assess the guidance and seek licenses. ASIC also proposed relief for certain stablecoin and wrapped-token distributors, and custodians of digital asset financial products, ahead of the recently proposed law reforms.

The regulator  said the proposed relief responds to industry feedback from its earlier consultation, where respondents expressed need for further clarification on the treatment of stablecoins and wrapped tokens.

ASIC's updated guidance comes after months of consultation with the industry. In December 2024, ASIC released a consultation paper seeking feedback on how existing laws should apply to digital assets.

The move builds on Australia's recent efforts to create a clearer regulatory framework for crypto assets. In September, ASIC announced a class exemption allowing licensed intermediaries to distribute stablecoins without separate regulatory approvals, effectively easing licensing rules for stablecoin intermediaries.

Last month, Australia's Treasury also proposed draft legislation requiring crypto exchanges and certain crypto service providers to hold financial services licenses.