Australian cryptocurrency exchange Swyftx has announced it will be closing its Earn program this week, citing “the constantly changing regulatory landscape.”
Upon closure of the program on Jan. 10, users will have their entire earn balances returned to their trading wallets, Swyftx announced. The exchange said the decision was not financially motivated, and that issues with client assets were not responsible for the program’s removal.
As Earn users generated yields by staking their assets on-chain, no funds had been at risk to third parties.
Changing Regulations
Swyftx emphasized its belief in the value of cryptocurrency, but said that greater regulatory clarity is currently necessary for crypto products like Earn. The exchange expressed its commitment to cooperate with authorities to create a more coherent regulatory regime for cryptocurrencies. Once these rules become clear, Swyftx added that it hoped to eventually re-open the Earn program.
Last month, Australia’s Prime Minister Anthony Albanese announced that the country would be working towards improving regulation of cryptocurrency providers. Consequently, the Treasury said it would release a consultation paper early this year to solicit advice about which digital assets to regulate.
In creating a framework to keep consumers safe, the administration is also looking to build custody and license settings. Authorities then intend to craft legislation based on the results of the consultation.
ASIC Actions
In addition to pending legislation, recent regulatory actions may have also influenced Swyftx’s decision to phase out its Earn program. The Australian Securities and Investments Commission (ASIC) recently sued Finder.com for offering customers unregistered financial services relating to cryptocurrency.
In its court filing, ASIC stated that users of Finder.com “made uninformed (or inadequately informed) investments. Which in turn exposed them to a risk of loss,” as they “did not have the benefit of the regulatory regime.” The lawsuit is the ASIC’s third against a supplier of crypto-related products in the past two months.
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