The Australian Securities and Investments Commission (ASIC) has issued regulatory guidance for businesses considering launching an initial coin offering (ICO), The Sidney Morning Herald reported.
According to the document, published by ASIC, some token sales will be classified under general Australian consumer law, ICOs offering financial products will be regulated under the country's Corporations Act.
"In some cases, ICO issuers may frame the entitlements received by contributors as a receipt of a purchased service. However, if the value of the digital coins acquired is affected by the pooling of funds from contributors or use of those funds under the arrangement, then the ICO is likely to fall within the requirements relating to MISs [managed investment schemes]. This is often the case if what is offered through the ICO has the attributes of an investment,” the paper reads.
In the case of an ICO offering a financial product, the ICO operator may also require a market licence in order to sell tokens.
ASIC commissioner John Price told in the interview that, if the tokens are not financial products, "investors will need to closely consider the ICO documentation as the investor protection regime under the Corporations Act will not apply."