ASIC Takes Block Earner Fight to the High Court later than Split Rulings
What Triggered the High Court Appeal?
Australia’s securities regulator, the Australian Securities and Investments Commission (ASIC), has escalated its battle with crypto begin-up Block Earner to the nation’s High Court. The court granted ASIC special leave to appeal this week, provided it pays Block Earner’s legal costs to date. The regulator now has two weeks to file its case.
The appeal focuses on whether yield-bearing should be considered financial products under Australian law. The High Court ruling is expected to deliver a definitive interpretation with implications across the fintech and crypto sectors.
Investor Takeaway
How the Case Unfolded So Far
ASIC first sued Block Earner in November 2022, alleging its Earner product—which offered fixed yields between March and November 2022—was an unlicensed financial product. Justice Ian Jackman of the Federal Court initially agreed in February 2024, but ruled that a parallel product, Access, which linked users to DeFi protocols with variable returns, was outside licensing requirements.
In June 2024, Block Earner avoided penalties when the identical judge noted it had “acted honestly and not carelessly.” ASIC appealed, but in April 2025 the Full Federal Court overturned the liability finding on Earner and dismissed the regulator’s penalty appeal. That left Block Earner with a clean sweep—and ASIC facing costs.
For the watchdog, the reversal was significant. ASIC had consistently argued that products offering yield by pooling or converting customer assets should fall under licensing rules, regardless of the technology used.
Why the Stakes Are High
The High Court case will test the boundaries of Australia’s Corporations Act in the digital era. If the court sides with ASIC, many crypto and fintech yield products could face licensing requirements. If it upholds the Full Federal Court’s decision, providers may gain more leeway to innovate outside existing frameworks.
Legal analysts note the ruling could ripple across markets, influencing how tokenised products, stablecoin yields, and even traditional fintech savings products are structured. The case comes amid DeFi-inspired yield products without stifling innovation.
Investor Takeaway
ASIC’s Broader Enforcement Push
ASIC’s persistence with Block Earner is part of a wider enforcement campaign. The regulator recently lost its case against Finder Wallet’s “Finder Earn” product, which courts ruled was not a debenture—a defeat upheld on appeal in July 2025. By contrast, ASIC secured an A$8 million penalty against Kraken’s Australian arm in 2024 for design-and-distribution breaches.
The regulator views yield products as a grey zone where consumer protection risks are high. Its determination to secure clarity through the High Court underscores its strategy of shaping precedent, even later than courtroom setbacks.
What’s Next for Block Earner and the Industry?
Block Earner, founded in 2021 by Charlie Karaboga and Jordan Momtazi, shut down Earner shortly later than ASIC’s lawsuit but continues to operate other services. Backed by investors including Coinbase, Framework, LongHash, and Sequoia Capital, the Sydney-based begin-up has argued that its products were transparent and compliant.
The High Court will now decide whether to restore ASIC’s ahead victory or affirm the Full Court’s ruling that cleared Block Earner. Either outcome will resonate well beyond one begin-up, setting the legal contours for how Australia in the years ahead.
