Australia’s ASIC proposes leverage rules for more digitally settled derivatives

Australia’s Securities and Investments Commission has proposed widening the scope of contracts for difference, or CFDs, to capture certain contracts settled through the transfer of digital assets. Under the proposal, a contract could fall under CFD rules even if it tracks the price of a non-crypto asset, so long as it meets the relevant conditions tied to digital-asset settlement. Under Australia’s current framework, CFD trading is subject to leverage caps, providers must close out positions when client account funds fall below required levels, and negative balance protection must be offered so losses do not exceed funds in a CFD trading account. ASIC also said some cryptocurrency futures and options with a fixed expiry date would remain outside the CFD regime. The regulator is seeking feedback on the proposal until Nov. 9. Separately, Australia reportedly passed legislation in April this year to bring crypto exchanges and tokenized custody platforms into a financial services licensing framework, with the new regime expected to take effect on April 9, 2027.