Australia’s transitional relief for digital asset firms ends on September 30, 2026: any business providing financial services in relation to digital assets that has not lodged an Australian financial services (AFS) licence application, or triggered one of four alternative pathways, by that date loses the protection of ASIC’s class no-action position and is exposed to the full civil and criminal penalty regime from October 1.

The Australian Securities and Investments Commission (ASIC) said on September 2, 2026 that it had recorded “over 45 licence applications” from digital asset businesses since Information Sheet 225 was updated in October 2025, and warned that missing the September 30 cut-off exposes firms to penalties “reaching up to 10% of annual turnover”. On June 25, 2026, when ASIC extended that same deadline by three months, the published figure was “approximately 30”. That is at least 15 further applications in 69 days, into a window with 21 days left. This analysis sets out what the no-action letter actually requires, why the 10% turnover headline understates the exposure, and how the European Union and the United Kingdom sequenced the identical problem.

Key facts

• Deadline: September 30, 2026 to lodge an AFS licence application or variation, per paragraph 1(a)(i) of ASIC’s class no-action letter of June 25, 2026.
• Applications: “over 45” as at September 2, 2026, up from “approximately 30” as at June 25, 2026 (ASIC media release).
• Maximum civil penalty for a company: the greater of 50,000 penalty units (A$18.2 million), three times the benefit obtained, or 10% of annual turnover capped at 2.5 million penalty units (A$910 million). A penalty unit is A$364 from July 1, 2026 (ASIC, Fines and penalties).
• Eligibility cut-off: condition 6 limits reliance to firms that first provided the service in this jurisdiction on or before December 31, 2025.
• Carve-outs: paragraph 5 excludes crypto lending and “earn” products, non-cash payment facilities other than stablecoins, and digital asset derivatives other than wrapped tokens.
• New law: the Corporations Amendment (Digital Assets Framework) Act 2026 passed Parliament on April 1, 2026, received Royal Assent on April 8, 2026, and commences April 9, 2027 (ASIC roadmap, April 20, 2026).

Methodology and sources

This analysis rests on five primary ASIC documents: the September 2, 2026 final-call news item; the June 25, 2026 extension news item; the class no-action letter of June 25, 2026, the operative instrument, read in full; the implementation roadmap of April 20, 2026; and media release 25-250MR of October 29, 2025, which introduced the updated Information Sheet 225. Penalty figures come from ASIC’s fines and penalties page. Comparative material comes from the Financial Conduct Authority’s cryptoassets regime policy statements of June 30, 2026 and the European Securities and Markets Authority’s MiCA page and interim register. Scope is Australia, the European Economic Area and the United Kingdom. One caveat: ASIC has not published the size of the population it is licensing, and AUSTRAC’s live digital currency exchange register could not be retrieved for this article, so no denominator for the 45 applications is asserted below.

What the class no-action letter actually says

The instrument that matters is not the media release but the class no-action letter of June 25, 2026, which supersedes the October 29, 2025 version. Paragraph 1 says ASIC does not intend to act on a contravention of subsection 911A(1) of the Corporations Act 2001 — the requirement to hold an AFS licence — where, on or before September 30, 2026, the person has done one of five things: lodged an AFS licence application or variation; been appointed an authorised representative under section 916A; arranged for a related body corporate to lodge and authorise them afterwards; entered an intermediary authorisation under paragraph 911A(2)(b) and notified ASIC; or issued products under a related-body-corporate arrangement where that entity has lodged. The last two routes were added in June.

A class no-action position is not a licence and not relief; it is a statement that the regulator does not presently intend to act. Its protection runs from lodgement until ASIC determines the application — ending on the day ASIC refuses to receive the application under subsection 1274(8), the day the applicant withdraws it, the day ASIC refuses it, or the day the licence is granted or varied. That differs from a hard sunset: a firm that lodges by September 30 can keep trading through a determination process of unknown length. Three conditions narrow who qualifies. Condition 6 restricts reliance to firms already providing the service in Australia on or before December 31, 2025. Condition 7 requires firms serving retail clients to have joined the Australian Financial Complaints Authority (AFCA) before lodging. Condition 8 requires foreign companies to be registered under section 601CF with a local agent.

An exit door closes on the same day. Paragraph 4 covers a firm that notifies ASIC in writing by September 30, 2026 of an intention to cease, provided the specified cessation date is no later than September 30, 2026 and no later than three months after the notice. Firms leaving the Australian market face the same deadline as firms staying. Separately, applicants for an Australian market licence under section 791A(1) or a clearing and settlement facility licence under section 820A(1) must have notified ASIC in writing and attended a licensing pre-meeting by September 30, then lodge within 12 months.

How three regimes sequenced the same problem

Jurisdiction / regulator	Effective date	Scope	Key requirement	Penalty / sanction
Australia (ASIC), current law	No-action ends September 30, 2026	Digital asset financial products; excludes lending/earn, most non-cash payment facilities, non-wrapped-token derivatives	Lodge an AFS application or variation (s911A(1)); market and CS applicants notify plus pre-meeting (s791A(1), s820A(1))	Company: greater of 50,000 penalty units (A$18.2m), 3× benefit, or 10% turnover capped at A$910m
Australia (ASIC), DAF Act	Commences April 9, 2027	Digital asset platforms and tokenised custody platforms	Asset-holding standards (s912BE) and transactional and settlement standards (s912BF), plus financial requirements modelled on RG 166	AFS licensing penalties apply; standards set by legislative instrument after consultation
United Kingdom (FCA)	Cryptoassets Regulations passed February 4, 2026; activities expand October 25, 2027	Firms carrying on newly regulated cryptoasset activities by way of business in the UK	Part 4A FSMA authorisation; savings-provisions window opens September 30, 2026, closes February 28, 2027	Late applicants cannot rely on savings provisions and “may need to cease carrying on relevant activities until they are authorised”
European Union (ESMA and national authorities)	MiCA applied December 30, 2024; Article 143(3) grandfathering ended July 1, 2026	CASPs operating under national law before December 30, 2024	MiCA authorisation; Article 143(6) simplified procedure for entities already nationally authorised	Grandfathering ended on the earlier of July 1, 2026 or grant or refusal; member states could shorten it

Sources: ASIC class no-action letter (June 25, 2026); ASIC implementation roadmap (April 20, 2026); ASIC fines and penalties; FCA cryptoassets regime policy statements (June 30, 2026); ESMA MiCA page and interim MiCA register. Last updated: September 9, 2026.

ASIC has chosen the more forgiving of the two available designs, then attached it to the harsher of the two calendars. On design, Australia and the United Kingdom land in the same place: lodge by the deadline and you may keep operating until your application is determined. The European Union did the opposite. Article 143(3) of MiCA let firms providing crypto-asset services under national law before December 30, 2024 continue until July 1, 2026 or until granted or refused authorisation, whichever came first — a fixed sunset that fell whether or not a national competent authority had decided. ESMA’s interim MiCA register, published on September 2, 2026, listed 341 crypto-asset service provider (CASP) records across 26 home member states, of which 339 carried no authorisation end date, with authorisation dates from December 30, 2024 to August 28, 2026. That is the throughput of 26 supervisors over roughly 20 months, and well above the count recorded when the MiCA transition closed in July.

The calendar is where Australia diverges. The FCA’s savings-provisions window opens on September 30, 2026 — the same day ASIC’s closes — and runs to February 28, 2027, against a regime whose regulated activities expand from October 25, 2027. British firms get five months, opening after the final rules are published and shutting 13 months before the UK perimeter moves. Australian firms have had 11 months from October 29, 2025, and their window closes 191 days before the Corporations Amendment (Digital Assets Framework) Act 2026 commences. ASIC’s roadmap places digital asset platform (DAP) and tokenised custody platform (TCP) licence applications in months 12 to 18 of an 18-month timeline that began in April 2026. A venue is therefore being asked to obtain an authorisation under the existing law this month, then apply again for a platform authorisation roughly seven months later. ASIC has flagged that it may consult on “a potential streamlining of the licence variation process for certain cohorts of firms”, naming those who have only recently licensed under INFO 225, but that streamlining does not yet exist.

“Many widely traded digital assets are financial products under current law – and will remain so under the Government’s proposed law reform – meaning many providers require a financial services licence. Licensing ensures consumers receive the full suite of protections under the law and allows ASIC to act when poor practices lead to harm.”

— Alan Kirkland, Commissioner, Australian Securities and Investments Commission (ASIC media release 25-250MR, October 29, 2025)

Why the 10% turnover figure understates the exposure

ASIC’s release, and the coverage that followed it, led with fines of up to 10% of annual turnover. For most firms in scope, that framing is the wrong way round. Under the strengthened provisions introduced by the Treasury Laws Amendment (Strengthening Corporate and Financial Sector Penalties) Act 2019, which commenced on March 13, 2019, the maximum civil penalty for a company is the greater of three amounts: 50,000 penalty units, three times the benefit obtained or detriment avoided, or 10% of annual turnover capped at 2.5 million penalty units. With a penalty unit at A$364 for contraventions on or after July 1, 2026, the first limb is a floor of A$18.2 million and the cap is A$910 million. Ten per cent of turnover only exceeds that floor once annual turnover passes A$182 million.

Below that line — where most Australian digital asset venues sit — the turnover limb is irrelevant, because the statutory maximum is already A$18.2 million per contravention. For a venue with A$40 million of annual revenue, the 10% headline implies A$4 million; the actual maximum is A$18.2 million, or about 45% of turnover. The turnover limb only starts doing work for the largest operators, and stops above A$9.1 billion of turnover, where the cap binds. Contraventions are counted per breach, and criminal liability is available in addition. None of this predicts what a court would order, but the widely repeated “10% of turnover” line describes the smallest of the three limbs for almost everyone reading it.

Enforcement context: what Block Earner settled

The reason ASIC can be this direct about the perimeter is a judgment handed down three months ago. On June 17, 2026, the High Court of Australia unanimously found, 7-0, that the fixed-yield “Earner” product offered by Block Earner — the trading name of Web3 Ventures Pty Ltd — was a financial product requiring an AFS licence. The court held it was sufficient that investors’ funds were used or intended to be used to generate a return for both the investor and the issuer, noting that “any contention otherwise would ignore the commercial reality of any such financial investment”, and accepted ASIC’s argument that Earner was also a derivative because the amount returned varied by reference to the value of the digital asset and exchange rates.

The procedural history is the point. ASIC commenced civil penalty proceedings on November 23, 2022; the Federal Court found unlicensed conduct on February 9, 2024, then relieved Block Earner from liability to pay a penalty on June 4, 2024. On April 22, 2025 the Full Court of the Federal Court allowed Block Earner’s cross-appeal and dismissed ASIC’s — a ruling that sent ASIC to the High Court for special leave, granted on September 4, 2025, with the hearing held on March 12, 2026. For 14 months, an Australian appellate court agreed with the industry position that the product fell outside the financial product definition. That is the strongest steelman for firms slow to lodge: the perimeter was genuinely contested at appellate level while the no-action clock ran. The penalty question remains live before the Full Court. ASIC has separately used its unlicensed-conduct powers against offshore venues, including a public warning over Bitget’s unlicensed crypto futures products.

“This reinforces ASIC’s long-standing position that the definition of financial product is broad and technology neutral and so captures new and emerging products without the need to amend the legislation.”

— Sarah Court, Chair, Australian Securities and Investments Commission (ASIC media release 26-124MR, June 17, 2026)

What this means for exchanges, brokers, custodians and compliance teams

Exchanges and platforms. The threshold question is whether the venue was operating in Australia on or before December 31, 2025. If not, condition 6 means the no-action position was never available. If so, the task before September 30 is lodgement, not approval — and for venues serving retail clients, AFCA membership must be in place before the application goes in, a sequencing trap rather than a formality. Venues that match orders may also need an Australian market licence, requiring a written notification and an attended pre-meeting by the same date. ASIC’s capacity to hold those pre-meetings inside three weeks is a real constraint, and the letter offers no relief to a firm that requested one and could not get it. What an Australian licence buys, and what it costs to keep, is now a live capital-allocation question for offshore venues.

Brokers and intermediaries. A firm does not necessarily need its own licence by September 30. Appointment as an authorised representative under section 916A, or an intermediary authorisation under paragraph 911A(2)(b) with notification to ASIC, both preserve the position — but both require a willing licensee counterparty and executed documentation before the deadline, not after it.

Custodians and fund managers. Tokenised securities and digital asset wallets were named as financial products in the October 2025 guidance package, which also proposed relief for certain stablecoin and wrapped token distributors and for custodians. Firms relying on that proposed relief should confirm the final instruments, not the consultation drafts.

Legal and compliance teams. The three exclusions in paragraph 5 deserve a documented file note. A firm with a lending or earn line has had no transitional cover at any point — a conclusion the High Court’s Block Earner reasoning makes harder to argue around. Every firm should also diarise the second application: an AFS licence obtained this year does not carry a DAP or TCP authorisation.

What’s next: the forward view

Three things are pending. First, ASIC’s standard-setting consultation. The roadmap commits ASIC to consult on asset-holding standards under section 912BE, modelled on Regulatory Guide 133 and covering assets held on trust, segregation of client assets and withdrawal rights; on transactional and settlement standards under section 912BF, covering fair, orderly and transparent operation, best execution, trade transparency, listing criteria and market abuse monitoring; and on financial requirements comprising a cash needs test, a net tangible assets requirement and periodic auditor review. No consultation package had been published as at September 9, 2026.

Second, the new regulatory guide for DAPs and TCPs, scheduled for months 6 to 12 of the roadmap, with updates to Regulatory Guide 1 and Regulatory Guide 166. Whether ASIC delivers the streamlined variation pathway it flagged for recent INFO 225 licensees is the most consequential open question for firms lodging this month.

Third, the Block Earner penalty appeal. Because the Federal Court relieved Block Earner of liability partly on the basis of its conduct and the state of the law, the outcome will indicate how much credit a court gives a firm that operated in a contested perimeter. ASIC has said it will factor the no-action position into its assessment of historical conduct while continuing to act against egregious conduct involving significant consumer harm or widespread systemic misconduct. The wider policy calendar continues to tighten: the government has also legislated the end of the 50% capital gains tax discount for crypto from July 2027.

FAQ

What exactly must a firm do by September 30, 2026?

Under paragraph 1 of ASIC’s class no-action letter, a firm must have lodged an AFS licence application or variation, been appointed an authorised representative under section 916A, entered an intermediary authorisation under paragraph 911A(2)(b) with notice to ASIC, or completed one of two related-body-corporate arrangements. Firms needing an Australian market licence or a clearing and settlement facility licence must instead have notified ASIC in writing and attended a licensing pre-meeting, lodging within 12 months.

Does lodging by the deadline mean a firm can keep trading?

Yes, subject to the letter’s conditions. The no-action position runs until ASIC determines the application, ending on the day ASIC refuses to receive it under subsection 1274(8), the day the applicant withdraws it, the day ASIC refuses it, or the day the licence is granted or varied. Unlike MiCA’s Article 143(3) grandfathering, which ended on July 1, 2026 whether or not a decision had been reached, Australia’s position has no fixed sunset once an application is lodged.

Is the maximum penalty really 10% of annual turnover?

Ten per cent of turnover is one of three limbs, and the applicable maximum is the greatest of them. The others are 50,000 penalty units — A$18.2 million for contraventions on or after July 1, 2026 — and three times the benefit obtained or detriment avoided. Because 10% of turnover only exceeds A$18.2 million once turnover passes A$182 million, most in-scope firms face the fixed floor rather than the percentage. The turnover limb is capped at A$910 million.

Which activities are outside the no-action position?

Paragraph 5 excludes three categories: crypto lending and “earn” products, being facilities under which a person lends digital assets to others or pays a return to customers from the use of digital assets; non-cash payment facilities other than stablecoins where a digital asset is used to make a payment; and derivatives in relation to digital assets other than wrapped tokens. Firms in those lines have never had transitional cover under this instrument.

What about firms that started operating in Australia during 2026?

Condition 6 requires a firm to have first provided the financial service, operated the financial market or operated the clearing and settlement facility in this jurisdiction on or before December 31, 2025. A business that began serving Australian clients in 2026 cannot rely on the no-action position at all, whether or not it lodges by September 30. Its obligations are governed by the ordinary operation of sections 911A, 791A and 820A.

Does an AFS licence obtained now cover the new DAF Act regime?

No. The Corporations Amendment (Digital Assets Framework) Act 2026 commences on April 9, 2027 and brings digital asset platforms and tokenised custody platforms into the licensing regime as new authorisation types. ASIC’s roadmap places those applications in months 12 to 18 of an 18-month implementation timeline, with operators able to trade under regulatory relief until their applications are processed.

Featured image: Sydney’s central business district seen from Sydney Tower, by Jorge Láscar, licensed under CC BY 2.0 via Wikimedia Commons.

This article is informational analysis only and does not constitute legal, regulatory, tax, or investment advice. Regulatory frameworks change frequently and interpretation depends on facts and circumstances; primary documents and official regulator guidance always supersede summaries. Firms should consult qualified legal counsel and their relevant supervisory authority before taking any action based on the analysis above.