The financial watchdog of Australia intends to apply leverage restrictions and additional protections for retail investors to specific trading contracts that settle in cryptocurrency.
During Monday’s announcement, the Australian Securities and Investments Commission (ASIC) put forward an expansion of regulations concerning contracts for difference (CFDs), which permit speculators to wager on valuation shifts absent direct ownership of the underlying instrument.
Current guidelines typically address contracts settled via fiat or through the mutual cancellation of participant obligations. ASIC aims to incorporate agreements finalized by transferring virtual currencies—even those following non-crypto properties—as long as they fulfill remaining CFD qualifications.
The agency noted that specific cryptocurrency options and futures featuring predetermined expiration dates will stay exempted from CFD regulations.
Australia’s current regulatory system, established in 2021, limits leverage while mandating that platforms liquidate trades whenever customer balances drop beneath predefined thresholds. Furthermore, negative balance protection restricts potential financial damage exclusively to the capital residing inside a user’s CFD account.
Public commentary regarding these suggested modifications and expansions remains open until November 9.
In a separate development, Australia enacted a law last April to incorporate digital asset exchanges and token-based custody services into its broader financial licensing structure, with implementation scheduled for April 9, 2027.
Additionally, ASIC mandated that cryptocurrency enterprises depending on provisional enforcement exemptions under current financial statutes must submit license petitions by September 30 or request modifications to their existing authorizations.
Related: Australia says it removed 45 crypto, remittance registrations over the past year
Originally published at https://cointelegraph.com/news/australia-asic-crypto-settled-cfd-protections?utm_source=rss_feed&utm_medium=rss&utm_campaign=rss_partner_inbound.
