This move by ASIC has sounded an alarm for the entire industry: no matter how it's packaged, as long as it involves investment returns linked to underlying assets, courts will see it as a derivative product, and licenses can't be avoided.

The High Court of Australia, with a 7:0 ruling, upheld ASIC’s sanctions against Block Earner’s Earner digital asset product, finding that it constitutes a financial investment instrument, that it requires an Australian Financial Services license, and that the investment return varies with changes in the underlying assets and exchange rates, fitting the definition of derivatives. The case will be remitted to the Full Federal Court for a decision on the sanctions issue. Block Earner terminated the product in November 2022 and shifted to other businesses.