World Crypto Global
- Written by: Tareq Sikder
- Fri, 03 May 2024
- Israel
The Federal Court has found BPS Financial Pty Ltd (BPS)guilty of engaging in unlicensed conduct concerning the 'Qoin Wallet', anon-cash payment facility utilizing a crypto-asset token known as 'Qoin.' Thejudgment was delivered by Justice Downes in proceedings brought by ASIC.Further Proceedings Ordered by the Court The court determined that BPS, from January 2020 onwards(with a brief exception of a 10-month period), violated the Corporations Act bylacking an Australian Financial Services Licence. Furthermore, BPS was notauthorized by any licensee to issue or provide financial advice regarding theQoin Wallet. Justice Downes also found BPS guilty of misleading or deceptiveconduct and propagating false representations about the Qoin Wallet.Among the misleading claims, BPS falsely asserted that theQoin Wallet was officially registered or approved, misrepresented its usabilityfor purchasing goods and services from Qoin merchants, and misled consumersregarding the exchangeability of Qoin tokens for other crypto-assets orcurrencies. The court disclosed that prior to November 2021, the only digitalcurrency exchange accepting Qoin was BTX Exchange, which had affiliations withBPS and did not facilitate independent exchanges of crypto assets. The court has mandated the involved parties to discussfurther proceedings, including penalties, to address the remaining issues inthe case. These deliberations are slated to occur later in 2024.The Federal Court has found BPS Financial engaged in unlicensed conduct over a non-cash payment facility which used a #crypto asset token called Qoin https://t.co/tHQkU9lUpQ pic.twitter.com/2bWhGGyhej ASIC Media (@asicmedia) May 3, 2024Legal Scrutiny over Sales Practices of Payment FacilityBPS aggressively promoted Qoin tokens to both retailconsumers and business owners, colloquially termed 'Qoin Merchants,' as amethod of payment for goods and services. As of September 30, 2022, the QoinWallet had been issued over 93,000 times, with BPS accumulating over $40million from Qoin Token sales. Justice Downes affirmed that the Qoin Walletconstituted a financial product, specifically categorizing it as a non-cashpayment facility.Joe Longo, ASIC Chair, said: Crypto assets are highlyvolatile, inherently risky, and complex. This makes it critically importantthat providers have the appropriate licences and authorisations, and thatinvestors are provided with clear and accurate information. This case is an importantreminder that many crypto products are financial products and that providersneed to hold a licence.This article was written by Tareq Sikder at www.financemagnates.com.
