Breaking: ASIC Wins Lawsuit Over Crypto Startup Block Earner

By Aaron Feuerstein February 09, 2024 In Australia, Cryptocurrency
  • The Australian Securities and Investments Commission (ASIC) won a landmark case against Block Earner for offering unlicensed financial products to investors, violating the 2001 Corporations Act.
  • The Federal Court found Block Earner’s “Earner” product in breach of financial regulations, but not the “Access” product, with penalties yet to be determined.

The Australian Securities and Investments Commission (ASIC) has won a court case against crypto startup Block Earner. The Federal Court of Australia found that the crypto company was in breach of the 2001 Corporations Act for offering financial services without a licence.

Judge Ian Jackman found defendants guilty of “operation of unregistered management investment scheme in contravention” and “carrying on financial services business without an Australian Financial Services Licence.”

ASIC was pursuing legal action against Web3 Ventures Pty Ltd, which operates as Block Earner, for alleged breaches of the Act in connection with two of its products, named “Earner” and “Access”.

Court’s Mixed Verdict on Crypto Products

Block Earner, distinguishing itself from typical crypto exchanges and apps, attempted to connect investors with leading decentralised finance (DeFi) lending protocols, offering returns for “staking” a stablecoin. This move beyond simply facilitating the purchase and sale of cryptocurrencies included offering fixed-yield earning crypto products, which the court found should have been registered as a managed investment scheme.


The legal dispute focused on whether the Earner and Access products qualify as “financial products” under the law. ASIC argues that they are, identifying them as either managed investment schemes, facilities for making financial investments, or derivatives.

The court agreed with ASIC that “Earner” contravened sections 601ED and 911A of the Corporations Act, but failed to do so for “Access.”

Penalties in the case are yet to be decided and a future hearing, which has not been scheduled yet.

Aaron Feuerstein

Aaron Feuerstein

Aaron Feuerstein is a freelance writer based in Melbourne. His focus is on decentralised finance and the regulatory space surrounding blockchain. He holds a Master's in Accounting. When he is not studying the latest legal case, he enjoys his time as a modest but eager hobby cook.

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