Australian Federal Court Rules Against BPS Financial Over Unlicensed ‘Qoin Wallet’

BPS Financial was found guilty of operating the “Qoin Wallet” without the necessary authorization, according to a recent ruling from the Australian Federal Court. The Australian Securities and Investments Commission (ASIC) is committed to maintaining regulatory compliance in the volatile cryptocurrency market, and this verdict further demonstrates their dedication.

In a statement released by ASIC, the Federal Court found that BPS Financial Pty Ltd. violated license requirements when it provided the non-cash payment system known as “Qoin Wallet,” which uses the cryptocurrency token “Qoin.” The fact that BPS Financial does not have an Australian Financial Services License to give or offer financial advice about the Qoin Wallet was highlighted by Justice Kylie Downes when she found the company guilty of violating the Corporations Act from January 2020.

ASIC Chair Joe Longo emphasized the significance of this ruling, stating that it marked the first court outcome against a non-cash payment facility involving cryptocurrency. He said, “ASIC has taken a number of enforcement actions against crypto asset businesses with the intention of clarifying what is a regulated product and when the provider needs a licence. Crypto assets are highly volatile, inherently risky, and complex. This makes it critically important that providers have the appropriate licenses and authorizations, and that investors are provided with clear and accurate information.”

Deceptive Practices Unveiled

Apart from violating the license, the court also found that BPS had participated in misleading activities. Misrepresenting the liquidity of Qoin tokens, the firm erroneously claimed that the Qoin Wallet was registered. It was determined by the court that, in contrast to BPS’s assertions, there was only one cryptocurrency exchange that was not affiliated with BPS that allowed Qoin prior to November 2021.

An aggressive warning was sent to the cryptocurrency business by ASIC’s Longo, who emphasized that companies need to follow legal requirements and not make any deceptive or fraudulent statements about their offers. In order to protect customers and maintain regulatory compliance, ASIC will continue to closely examine cryptocurrency goods, as this verdict makes abundantly evident.