Aussie Regulator Blocks Holon’s Crypto Funds
Bitcoin and other related crypto products being offered by this Australian asset management company is now on hold.
The Holon Investments Australia Limited has received cease-and-desist orders from the Australian Securities and Investments Commission. The three investment products that monitor Bitcoin (BTC), Ethereum (ETH), and Filecoin (FIL) are the focal point of the stop orders.
Although the government is crypto investor-friendly to some extent, ASIC is actively studying digital currency solutions and expanding its regulatory reach in the crypto industry.
The order to suspend crypto product offerings by Sydney-based asset manager Holon Investments is justified by a claim of non-compliance with TMDs, or target market determinations. This document specifies the financial product’s intended buyers, their goals, needs, and resources, as well as the product’s distribution strategy.
Regulation by securities authorities is one way that crypto can earn legitimacy as the industry develops and more institutions become involved.
Bitcoin, Other Crypto On The Crosshair
The ASIC press release states that the stop order is temporary in nature, giving Holon three weeks to meet the TMDs established by the Commission.
ASIC has voiced its sole concern that Holon has not “appropriately assessed the features and risks of the funds in determining their target markets.”
This is a significant issue since Bitcoin investors may overestimate their risk tolerance, which may result in greater losses for them. Although Holon has TMDs for the three funds, ASIC notes that the TMDs’ breadth and generality are inappropriate for the financial product due to the inherent volatility of cryptocurrencies.
Genesis, a decentralized exchange, manages the funds. This resulted from a partnership between Holon and Gemini early this year.
What This Means For Bitcoin In Australia
The Australian Securities and Investments Commission (ASIC) has established robust regulatory organizations to govern cryptocurrencies, making Australia an exceptionally crypto-friendly nation. With solid regulation, Australia might become the most crypto-friendly nation in the world.
The commission has also boosted the size of its cryptocurrency staff in an effort to better regulate cryptocurrencies. This action followed the Merge event, which prompted the U.S. Securities and Exchange Commission to investigate Ethereum.
The SEC argued that Proof-of-Stake cryptocurrencies, including Ethereum, Solana, and Cardano, are securities.
As crypto regulation expands in Australia, legislation will play a significant role in directing the expansion of crypto in Australia and other nations. However, crypto aficionados may be divided on the issue of regulation, as crypto and decentralized finance in general should be exempt from government control and policy.
With the rise of cybercrime in the cryptocurrency field, such as the recent Binance hack, it is necessary to protect crypto investors and traders from bad actors.
Crypto total market cap at $898 billion on the daily chart | Featured image from PlanetWare, Chart: TradingView.com