Australia's High Court backs regulator in Block Earner crypto yield case

Australia’s High Court delivered a unanimous 7-0 ruling siding with the Australian Securities and Investments Commission in its appeal over Block Earner’s former fixed-yield digital asset product, finding the offering required an Australian financial services licence under existing law.

The High Court held that Web3 Ventures Pty Ltd, which trades as Block Earner, offered a product that functioned as a facility for financial investment and also qualified as a derivative because investor returns varied with the value of underlying digital assets and exchange rates, according to a court document dated June 17. 

The matter will now return to the Full Federal Court to determine ASIC’s appeal on penalties arising from earlier Federal Court proceedings against Block Earner.

In a statement on Wednesday, ASIC said it commenced civil penalty proceedings against Block Earner in November 2022, over concerns the Earner product was offered without a licence, leaving investors without important protections.

The Federal Court found in February 2024 that Block Earner had operated an unregistered managed investment scheme, but subsequently relieved the company from financial penalties in June of the same year, according to the statement. 

ASIC appealed for a penalty waiver the same month, prompting a cross-appeal by Block Earner on July 9, 2024. The Full Federal Court allowed Block Earner's cross-appeal and dismissed ASIC's appeal on April 22, 2025. The High Court overturned that decision on Wednesday.

ASIC Chair Sarah Court welcomed the ruling.

“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,” Court said in the statement.

Block Earner, which voluntarily closed its Earner product in November 2022, has since shifted its business model away from yield products. The company was granted an Australian Credit Licence in May 2026 and has been developing a crypto-backed home loan offering. 

The licence marked the first time a digital asset platform in Australia had been authorized to provide credit products under its own licence.