On 5 September 2025, the High Court of Australia granted the Australian Securities and Investments Commission (ASIC) special leave to appeal a Full Federal Court decision in the Block Earner case. The lower court had ruled that Block Earner, a digital asset service provider, did not require an Australian Financial Services Licence (AFSL) to offer its fixed-yield crypto product. ASIC is seeking clarification on the scope of the statutory definition of a financial product, particularly where interest-bearing arrangements and asset-conversion products are involved. The outcome of this appeal will affect not only digital asset offerings but also the broader financial services regime in Australia, as the definition of financial product is drafted to be both broad and technology-neutral. The appeal, conditional upon ASIC covering Block Earner’s costs, is expected to set a critical precedent for crypto and traditional finance alike.
“The High Court has granted ASIC special leave to appeal a Full Federal Court decision, which found that digital asset service provider, Block Earner, did not need a financial services licence to offer a fixed-yield digital asset-related product.”
“ASIC’s appeal seeks the High Court’s ruling on what falls within the definition of a financial product, as well as clarifying when interest-earning products and products involving the conversion of assets from one form into another are regulated.”
Chronological Background
- 23 November 2023: ASIC filed civil penalty proceedings, alleging unlicensed services and operation of an unregistered scheme.
- 9 February 2024: Federal Court held Block Earner provided unlicensed financial services through its Earner product.
- 4 June 2024: Court relieved Block Earner from paying a penalty; ASIC appealed.
- 9 July 2024: Block Earner cross-appealed against the licensing requirement.
- 22 April 2025: Full Federal Court dismissed ASIC’s appeal and allowed Block Earner’s cross-appeal.
- 21 May 2025: ASIC sought special leave to appeal to the High Court.
- 5 September 2025: High Court granted ASIC special leave, with costs condition.
Regulatory Action and Objective
ASIC is pursuing clarification of the definition of “financial product” under Australian law, which was designed to be technology-neutral. Its position is that interest-yielding and asset-conversion products should be regulated, whether or not they involve digital assets.
This clarification is significant, as it extends beyond crypto into the mainstream financial system, shaping obligations for both innovators and traditional service providers.
The High Court’s acceptance of ASIC’s appeal transforms this into a landmark case. The question is whether crypto yield products like Block Earner’s “Earner” are regulated financial products, requiring licensing and compliance, or whether they can operate outside traditional regulatory boundaries.
If the High Court rules in ASIC’s favour, it will expand the reach of AFSL requirements and bring more digital asset products within Australia’s regulated perimeter. If Block Earner prevails, it could cement a significant gap in regulatory coverage, leaving certain yield-based digital products outside ASIC’s direct control.
