Australia Moves to Apply Retail CFD Safeguards to…
By Abdelaziz Fathi
AI summary of the source article
ASIC has proposed extending its retail CFD safeguards to cover derivatives settled in digital assets, preventing products from bypassing protections through crypto settlement. The regulator is also proposing to extend the broader CFD product intervention order for another 10 years.
Why it matters
The proposal aims at "closing a regulatory gap that can leave economically similar leveraged products subject to different protections depending on how they are settled" and targets regulatory arbitrage so "changing a CFD’s settlement asset would no longer be enough to avoid retail leverage and loss protections."
Key facts
- ASIC proposed expanding its CFD product intervention order to derivatives settled via digital assets, with consultation open until November 9.
- The regulator is also proposing a 10-year extension to the broader CFD intervention order, which currently expires on May 23, 2027.
- In the 2023–24 financial year, 68% of retail CFD clients lost money, resulting in aggregate net losses exceeding A$458 million.
Source excerpt · FinanceFeeds
Australia’s securities regulator wants to extend its retail CFD safeguards to derivatives settled in digital assets, closing a regulatory gap that can leave economically similar leveraged products subject to different protections depending on how they are settled. The Australian Securities and Investments Commission proposed on October 12 that its contracts-for-difference product intervention orde…