tl;dr
The Australian Securities and Investments Commission (ASIC) has issued a public warning against crypto exchange Bitget for offering high-risk crypto futures products without the required Australian Financial Services (AFS) license. Bitget and its parent company, BTG Technology Holdings Limited, are ...
The Australian Securities and Investments Commission (ASIC) has issued a public warning against Bitget, accusing the crypto exchange of offering high-risk crypto futures products without the necessary Australian Financial Services (AFS) license. ASIC stated that Bitget and its parent company, BTG Technology Holdings Limited, are promoting "unlicensed cryptocurrency futures products" to Australian investors, despite not holding the required license to do so. This means Bitget is not permitted to encourage Australian investors to invest in these financial products.
This warning aligns with ASIC's ongoing efforts to protect retail investors from speculative, complex, and unregulated crypto financial products. Previously, ASIC revoked Binance Australia Derivatives' license after the platform misclassified retail clients, stripping them of consumer protections such as product disclosure statements and dispute resolution mechanisms. Bridget Nichols, chief commercial officer at crypto asset manager Monochrome, noted the Australian government has been slow to clarify regulatory expectations, which complicates licensing for exchanges dealing with complex crypto products.
One key concern ASIC highlighted is Bitget's offering of leverage up to 125:1, far exceeding the regulator's imposed limit of 2:1 for licensed crypto derivatives. ASIC warned that such high leverage magnifies gains and losses, increasing the risk of substantial financial losses for investors. Without an AFS license, Bitget users lack essential protections like internal dispute resolution and client money protection, making it harder to seek help if things go wrong.
Nichols acknowledged ASIC's focus on investor protection but cautioned that regulatory measures can inhibit innovation, as the agency struggles to keep pace with fast-evolving digital asset technologies. She emphasized that integrating traditional financial frameworks around digital assets remains the only viable way to achieve regulatory clarity in Australia, citing Monochrome’s three-year journey to launch a Bitcoin ETF as an example of the challenges involved.
Currently, Bitget is registered with Australia’s financial intelligence agency, AUSTRAC, for basic exchange services but lacks the broader financial services license required for derivatives trading. ASIC's warning reflects growing international scrutiny of Bitget, with regulators in Spain, Austria, Germany, Canada, France, Cyprus, Malaysia, and Japan issuing similar warnings or taking regulatory actions against various Bitget entities since 2022.