Kraken Calls for Clearer Crypto Regulations in Australia Following Court Ruling on Margin Trading
Cryptocurrency exchange Kraken is calling for clearer regulations in Australia after a Federal Court found that its fiat margin trading product violated local laws.
In a statement released on September 8, Kraken expressed its disappointment with the court’s decision, highlighting the ongoing regulatory uncertainty faced by both crypto investors and businesses in the country. The exchange noted that the ruling points to broader issues in Australia’s approach to crypto regulation.
“The lack of regulatory clarity continues to create an unsatisfactory environment for the Australian crypto industry,” Kraken said. “This decision underscores the urgent need for tailored crypto regulations.”
The case dates back to civil proceedings initiated by the Australian Securities and Investments Commission (ASIC) in September 2023 against Bit Trade, a subsidiary of Kraken’s parent company, Payward Incorporated. ASIC alleged that Bit Trade failed to conduct a proper target market assessment for its margin trading product before making it available to customers.
In late August, the Federal Court ruled against Bit Trade, citing non-compliance with legal requirements when offering the product. ASIC’s Deputy Chair, Sarah Court, stated that the ruling sets an important precedent for crypto compliance in Australia.
As a result of the ruling, Kraken’s fiat margin trading services are now limited to wholesale clients in Australia, though its crypto margin trading remains unaffected. While acknowledged that Australia is making strides toward establishing a crypto regulatory framework, it warned that the new legislation could be delayed beyond the end of the year.
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