Aussie Regulator Blocks Holon’s Crypto Fund
Bitcoin and other related crypto products offered by this Australian asset management company are now on hold.
Holon Investments Australia Limited has received cease and desist orders from the Australian Securities and Investments Commission. The three investment products monitoring Bitcoin (BTC), Ethereum (ETH) and Filecoin (FIL) are the focus of the stop orders.
Although the government is somewhat crypto-investor friendly, ASIC is actively studying digital currency solutions and expanding its regulatory reach in the crypto industry.
The order to suspend the offerings of crypto products by Sydney-based asset manager Holon Investments is based on a claim of non-compliance with TMDs, or target market regulations. 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 regulators is one way crypto can gain legitimacy as the industry evolves and more institutions get involved.
Bitcoin, another crypto in the crosshairs
The ASIC press release says the stop order is temporary in nature, giving Holon three weeks to meet the TMDs set by the commission.
ASIC has expressed its only concern that Holon has not “appropriately assessed the features and risks of the funds in determining their target markets.”
Image: Crypto.News
This is a significant problem since Bitcoin investors can overestimate their risk tolerance, which can lead to bigger losses for them. Although Holon has TMDs for the three funds, ASIC notes that the breadth and generality of the TMDs is inappropriate for the financial product due to the inherent volatility of cryptocurrencies.
Genesis, a decentralized exchange, manages the funds. This was the result of a partnership between Holon and Gemini earlier 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 could become the most crypto-friendly nation in the world.
The commission has also increased the size of its cryptocurrency staff in an effort to better regulate cryptocurrencies. This action followed the merger incident, which prompted the US 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 guiding 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 should generally be exempt from government control and politics.
With the rise of cybercrime in the cryptocurrency space, 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
