An Australian Federal Court has ruled that the crypto firm Block Earner is not liable for penalties related to offering unlicensed financial services through its Earner product. Despite recognizing the seriousness of the offence, the court decided not to impose a penalty, citing that Block Earner “acted honestly and not carelessly” in its actions.

The case was brought by the Australian Securities and Investments Commission (ASIC), which argued that the Earner product was offered without necessary consumer protections. ASIC maintained that the product’s connection to cryptocurrency did not exempt it from financial services law.

Previously reported by Bitcoin.com News, the Federal Court upheld ASIC's position, ruling that Block Earner’s offering of the Earner product violated the Corporations Act.

Court Ruling Seen as Positive for Global Crypto Industry

Reacting to the ruling, Block Earner called the decision a significant step for an industry grappling with regulatory uncertainty and enforcement. Block Earner CEO Charlie Karaboga stated:

From the start, we never intended to break or bypass the rules. As a startup, we did everything we could to comply, including seeking legal advice and creating a comprehensive risk framework. While we are disappointed about the contravention findings related to the Earner product, we are pleased the judge acknowledged our honest efforts and exempted Block Earner from the penalty.

Following the court's June 4 ruling, ASIC announced it is still reviewing the decision.

Justice Ian Jackman ordered both parties to bear their own legal costs up to February 9. However, he ruled that ASIC should cover Block Earner’s legal costs from February 9 onward. Justice Jackman also noted that ASIC’s legal team admitted that the headline in their February 9, 2024 press release was incorrect and “had a tendency to mislead.”