ASIC Unveils Enhanced CFD Protocols for Digital Assets

Background

Australia's corporate regulator wants another decade of guardrails on contracts for difference. This time, digital assets are named in the rulebook.

Proposed Changes

The Australian Securities and Investments Commission (ASIC) published Consultation Paper CS 64, proposing to extend the existing CFD Product Intervention Order for ten years, out to 2037, subject to ministerial approval.

Key Provisions

The biggest change in CS 64 is definitional. The draft instrument would explicitly bring CFDs that settle through a transfer of digital assets into the order's scope. Contracts that pay out in crypto, rather than cash, would no longer sit in an ambiguous corner of the rules.

For CFD providers offering crypto exposure in Australia, products that settle in digital assets would likely face the same leverage caps, close-out rules and negative balance protections as cash-settled contracts. The no-netting margin rule could matter most to active traders who run offsetting positions. Requiring separate initial margin for each contract raises the capital needed to run hedged or paired strategies.

Uncertainty Surrounding Options CFDs

The options CFD question carries the most uncertainty. If feedback pushes ASIC toward restricting those products for retail clients, providers that rely on them could need to rethink their offerings.