Block Earner Wins Big: Australian Court Rules Against ASIC in Crypto Licensing Dispute

In a major victory for Australia’s crypto industry, the Federal Court has dismissed the Australian Securities and Investments Commission’s (ASIC) case against fintech startup Block Earner. The decision is a landmark moment, potentially reshaping how crypto products are classified under Australian financial law.

Why Block Earner Was Taken to Court

Back in November 2022, ASIC launched legal action claiming Block Earner needed a financial services license to offer its fixed-yield crypto products. The regulator believed the firm’s services qualified as financial products or managed investment schemes under the Corporations Act.

But Block Earner stood its ground, arguing that its “Earner” product simply allowed users to lend their crypto assets for a fixed return—without any pooled investment activity.

What the Court Actually Said

The Federal Court disagreed with ASIC’s stance. According to the judgment delivered by three senior justices, Block Earner’s offering doesn’t fall under the definition of a financial product, derivative, or managed investment scheme.

In plain English? Since customers were lending crypto under set terms with agreed interest and without sharing in a pooled profit, the product looked more like a straightforward loan than an investment scheme.

No Penalties, Full Legal Costs Paid

ASIC’s appeal to enforce penalties was also thrown out. The court ruled that Block Earner had acted honestly and relied on legal advice when launching the product. As a result, ASIC has now been ordered to cover all legal costs related to the case.

This is a rare win for the crypto side in a regulatory battle—especially when dealing with one of the most powerful financial watchdogs in the country.

What Happens to the Earner Product?

Despite the legal win, Block Earner has confirmed it won’t bring the “Earner” product back to market. Instead, the company will keep its focus on developing crypto-backed loan products—a sector it sees growing fast in Australia.

James Coombes, Chief Commercial Officer at Block Earner, shared that while regulation is complex, he hopes this ruling sets a positive precedent and encourages smarter regulatory conversations moving forward.

What This Means for Australia’s Crypto Space

This verdict sends a clear message: not all crypto products should automatically fall under traditional financial rules. It’s a win for fintech innovation in Australia and could pave the way for clearer, fairer treatment of crypto-native businesses.

With regulators like ASIC being urged to refine how they apply existing laws, more startups may now feel confident about entering the crypto space—without fearing ambiguous legal interpretation.

FAQs About the Block Earner vs ASIC Case

1. What is Block Earner?
Block Earner is an Australian fintech company that offered fixed-yield crypto lending products before pausing them due to legal action from ASIC.

2. Why did ASIC sue Block Earner?
ASIC believed Block Earner’s product was a financial product and required a license. The court ruled otherwise.

3. What did the court decide?
The Federal Court found that Block Earner’s product was a loan, not a financial product or investment scheme, and dismissed ASIC’s claims.

4. Will Block Earner relaunch its crypto product?
No. The company has decided not to bring the “Earner” product back but will continue building other crypto-backed services.

5. What does this mean for crypto regulation in Australia?
The case highlights the need for better clarity in crypto laws and may set a precedent for other firms offering similar products.