ASIC has released an updated to information sheet INFO 225: Initial coin offerings and crypto-assets. While ASIC’s position on when an ICO or crypto-asset will be a financial product remains largely unchanged (you can see our previous updates on the topic here and here), ASIC’s newest update acknowledges the changing nature of crypto-assets and the increased maturity of the market.
In the present times, where trading and dealing in virtual currencies (“VCs”) such as Bitcoins, is surging at an extraordinary rate with astonishing highs and lows, the question of recognition and regulation of VCs under the Indian laws still looms in a cloud of confusion. After several advisories of the Reserve Bank of India (“RBI”), which has till date stood short of declaring VCs as illegal, and subsequent raids reportedly conducted by the Enforcement Directorate against operators of trading platforms of VCs in India (as already discussed in our previous updates1), the Income Tax (“IT”) department and the Securities Exchange Board of India (“SEBI”) are now considering to crack down the unregulated reign of Bitcoins.
2017 has seen cryptocurrencies continue to grow in popularity throughout Australia and the world. The rapid increase in value of Bitcoin and Ether, coupled with their volatility (demonstrated by a 20% crash over two days last month) and potential use benefits, make cryptocurrencies a fascinating and challenging prospect for the future.
Given their origin on the blockchain, not only do cryptocurrencies and tokens raise practical considerations on issues such as cybersecurity, as demonstrated by the theft of around US$32 million worth of Ether tokens in July this year,1 but they also present difficulties for lawmakers, reflected by uncertainty about the treatment of digital currencies under existing regulatory regimes around the world.