Regulatory Alerts2025-09-05
High Court Grants ASIC Special Leave to Appeal Block Earner Decision
The High Court has granted ASIC special leave to appeal a Full Federal Court ruling that determined Block Earner did not require a financial services licence for its fixed-yield digital asset product. ASIC seeks a clarification on the definition of financial products, specifically regarding interest-earning products and asset conversions, to ensure regulatory consistency across the sector. The appeal, which is conditional on ASIC paying Block Earner's costs, was heard on 12 March 2026 with judgment reserved.
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.
From March 2022 to November 2022, Block Earner offered investors the Earner product allowing them to earn fixed yield returns from different digital assets.
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.
The definition of financial product was drafted in a broad and technology-neutral way, and ASIC believes it is in the public interest to clarify this.
This clarification is important as it applies to all financial products and services whether they involve digital assets or not.
The grant of special leave is conditional upon ASIC agreeing to pay Block Earner’s costs of the appeal. ASIC has 14 days to file a notice of appeal.
The appeal will be heard on a date to be set by the High Court.
Background
Block Earner is the trading name of Web3 Ventures Pty Ltd. It is an AUSTRAC-registered digital currency exchange.
ASIC commenced civil penalty proceedings in the Federal Court against Block Earner alleging it provided unlicensed financial services in relation to its crypto-asset based products and that it operated an unregistered managed investment scheme on 23 November 2023 ( 22-324MR ).
On 9 February 2024, the Federal Court found that from March to November 2022, Block Earner engaged in unlicenced financial services conduct when offering its Earner product. ( 24-019MR ).
On 4 June 2024, the Federal Court relieved Block Earner from liability to pay a penalty for offering the Earner product. ASIC appealed this decision on 18 June 2024 ( 24-119MR ).
On 9 July 2024, Block Earner cross-appealed the Federal Court’s decision that Block Earner needed a financial services licence to offer its Earner product ( 24-128MR ).
On 6 March 2025, the Full Federal Court heard ASIC’s appeal and Block Earner’s cross-appeal.
On 22 April 2025, the Full Federal Court allowed Block Earner’s cross-appeal and dismissed ASIC’s appeal( 25-062MR ).
On 21 May 2025, ASIC sought special leave from the High Court to appeal the Full Federal Court’s decision ( 25-082MR ).
Editor’s Note 1:
On 17 September 2025, ASIC filed a notice of appeal in this matter. The appeal will be heard on a date to be set by the High Court.
Editor's Note 2 :
The matter has been listed for hearing in the High Court of Australia in Canberra on 12 March 2026.
Editor's Note 3:
The matter was heard in the High Court of Australia on 12 March 2026. Judgment is reserved.