What happened
ASIC proposed extending its CFD product intervention order until May 2037 and updating rules to encompass derivatives settled using digital assets. Regulatory data revealed retail investors lost $458 million trading CFDs over 12 months, with 68% recording net losses. For crypto CFDs specifically, 69% of retail clients lost money, representing a higher loss rate than forex or commodity derivatives.
Why it matters here
By replacing 'cryptoasset' with 'digital asset' and targeting digital settlement mechanisms, ASIC is closing regulatory loopholes around derivative leverage. This ongoing intervention limits retail leverage on crypto derivatives to 2:1, protecting retail capital while increasing compliance requirements for brokers. The move highlights broader reluctance among major institutional lenders to accept unhedged cryptocurrency as recognized loan collateral.
What to watch
The closing of ASIC's public consultation period on November 9, followed by formal ministerial approval for the extended order.
Source
brokernews.com.au