ASIC takes Block Earner case to High Court

ASIC intends to appeal the Full Federal Court's decision, now seeking special leave from the High Court in its case against Block Earner.

The Federal Court decision found that a product issued by Block Earner, which allowed consumers to earn fixed yield returns from lending specified crypto-assets, was not a financial product.

ASIC said it is seeking to obtain the High Court's ruling on what falls within the definition of financial product and clarify when interest-earning products and products involving a 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," the regulator said.

"This clarification is important as it applies to all financial products and services whether they involve crypto-assets or not."

The High Court will consider ASIC's application on a date to be determined.

Block Earner noted ASIC's application to the High Court with a spokesperson saying: "This matter now relates to a broader legal question around the definition of a financial product, which extends well beyond Block Earner and the crypto sector. We believe the Full Federal Court's April ruling was a strong and well-reasoned decision that upheld the integrity of our operations.

"We remain confident in the soundness of that judgment and will respond to ASIC's application through the appropriate legal channels. Block Earner continues to operate business-as-usual and remains fully committed to compliance, innovation, and building products that benefit Australian consumers."

This legal battle has been ongoing in the courts for more than a year.

On 9 February 2024, the Federal Court found that from March to November 2022, Block Earner engaged in unlicensed financial services conduct when offering its Earner product.

The Federal Court dismissed ASIC's allegations that Block Earner's variable-yield digital asset related offering "Access" was a financial product, and that Block Earner engaged in unlicensed financial services conduct by offering Access.

On 4 June 2024, the Federal Court relieved Block Earner from liability to pay a penalty for offering the Earner product.

On 18 June 2024, ASIC appealed the Federal Court's decision to relieve Block Earner from liability to pay a penalty for offering the Earner product.

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.

On 6 March 2025, the Full Federal Court heard ASIC's appeal and Block Earner's cross-appeal.

Lastly, on 22 April 2025, the Full Federal Court allowed Block Earner's cross-appeal and dismissed ASIC's appeal.