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Selected cases

Federal Court of Australia · [2026] FCA 18

ASIC v BPS Financial

A Federal Court penalty decision about the Qoin Wallet, unlicensed financial services conduct, misleading crypto-payment claims and...

Federal Court of Australia27 Jan 2026

Plain-English explainers, not legal advice. Check the linked official source before you rely on a specific section, and get advice for your situation.

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Quick read

  • Crypto, payments and wallet products can fall inside financial-services law even where the business sees itself as a technology or marketplace operator.
  • A Federal Court penalty decision about the Qoin Wallet, unlicensed financial services conduct, misleading crypto-payment claims and corrective advertising.

Use this to check

  • Payments, wallet and token products may trigger AFSL issues even where no traditional investment product is being sold.
  • Regulatory engagement and legal advice are helpful only if they address the product actually launched.
  • Claims about user numbers, exchangeability and official approval need hard substantiation.

Decision snapshot

  1. 1

    What happened

    • BPS Financial operated the Qoin project, including the Qoin Wallet and Qoin Tokens.
    • The Qoin Wallet allowed users to make non-cash payments using Qoin.
    • Earlier liability decisions found that BPS carried on a financial services business without holding an Australian financial services licence and made false or misleading representations on its website and in a White Paper.
    • The representations concerned matters such as the number of wallet holders, the ability to exchange Qoin Tokens for fiat or other crypto-assets, and whether the Qoin Wallet was officially approved or registered.
  2. 2

    What the court had to decide

    • The Federal Court had to decide relief after seven declarations of contravention.
    • The issues included whether BPS should be relieved from liability for unlicensed conduct, the appropriate civil penalty, how to measure the benefit derived from the contravention, whether revenue or profit mattered for the maximum penalty, and what injunctions and corrective advertising should be ordered.
  3. 3

    What the court decided

    • The Court refused to relieve BPS from liability and determined that an appropriate total pecuniary penalty was $14 million.
    • It also ordered injunctions restraining unlicensed financial services conduct, corrective advertising on the Qoin website and app, and costs orders, with the parties to confer on the final form of penalty-payment orders.

Practical impact

Practical read

  • Crypto, payments and wallet products can fall inside financial-services law even where the business sees itself as a technology or marketplace operator.
  • Legal advice helps, but it has to match the actual product structure, authorisations and customer representations.

Useful next steps

  • Payments, wallet and token products may trigger AFSL issues even where no traditional investment product is being sold.
  • Regulatory engagement and legal advice are helpful only if they address the product actually launched.
  • Claims about user numbers, exchangeability and official approval need hard substantiation.
  • Corrective notices and long injunctions can become part of the remedy, not just money penalties.
  • Map the product against AFSL, non-cash payment and financial product advice rules before launch.

Practical read

This case is highly relevant for fintechs, crypto projects, payment platforms and marketplaces. BPS did not simply get punished because it used new technology. The Court looked at the actual financial product, the way the wallet and tokens worked together, the authorisation structure, the legal advice obtained, and the public claims made to users.

The judgment is especially useful because BPS had done some things that many founders would think are protective. It had met with ASIC, obtained advice and tried to rely on authorisation arrangements while an AFSL issue was unresolved. That did not excuse the contraventions. The Court accepted BPS acted honestly, but still found it had not done enough to be relieved from liability.

The practical lesson is not that every digital token business needs the same licence. The lesson is that you need a precise licensing analysis before launch, not a generic comfort note. The website, white paper, app screens, sales scripts and merchant materials also need to match what the product can actually do and what regulators have actually approved.

Checks to run

Key points

  • Map the product against AFSL, non-cash payment and financial product advice rules before launch.
  • Update legal advice when the actual wallet, token, issuer or representative structure changes.
  • Substantiate website, white paper and pitch-deck claims about users, exchangeability and approval.
  • Do not describe a product as approved or registered unless the exact approval exists.
  • Keep regulator correspondence, advice and launch decisions in one compliance file.

Key takeaways

  • Payments, wallet and token products may trigger AFSL issues even where no traditional investment product is being sold.
  • Regulatory engagement and legal advice are helpful only if they address the product actually launched.
  • Claims about user numbers, exchangeability and official approval need hard substantiation.
  • Corrective notices and long injunctions can become part of the remedy, not just money penalties.

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