Key facts
- ASIC is seeking High Court permission to appeal a ruling that Block Earner's fixed-yield crypto product is not a financial product.
- The Full Federal Court previously dismissed an earlier ruling that found Block Earner engaged in unlicensed conduct.
- ASIC wants to clarify the definition of a financial product under the Corporations Act, emphasizing its technology-neutral design.
- Block Earner stated the case raises broader legal questions beyond the crypto sector.
- Block Earner has ceased offering the 'Earner' product.
Australia's financial regulator, the Australian Securities and Investments Commission (ASIC), is seeking special leave from the High Court to appeal a recent Full Federal Court ruling that favored fintech firm Block Earner. The lower court had determined that Block Earner's crypto-linked fixed-yield earning service did not constitute a financial product under the Corporations Act.
ASIC stated its intention to ask the High Court to clarify the definition of a financial product, emphasizing that the term was drafted broadly and in a technology-neutral way. The regulator believes clarification is in the public interest and applies to all financial products, regardless of whether they involve crypto-assets.
The Full Federal Court's ruling on April 22, 2025, overturned an earlier Federal Court decision from February 2024, which had found Block Earner engaged in unlicensed conduct by offering its fixed-yield product. The April ruling concluded that the "Earner" product did not qualify as a financial product, managed investment scheme, or derivative, thereby removing the requirement for Block Earner to hold a financial services license for that offering.
A Block Earner spokesperson acknowledged the case has escalated to a broader legal question about the definition of a financial product, extending beyond the company and the crypto sector. The company expressed confidence in the April judgment and stated it has ceased offering the "Earner" product.
ASIC first launched legal proceedings against Block Earner in November 2022, arguing the company needed a financial services license to offer its yield product, which was available from March 2022 until it was shut down in November 2022. The High Court will consider ASIC's application for special leave to appeal at a date yet to be fixed.