Radhika Parashar
- The ASIC has called Bitget’s futures products as highly volatile and risky
- Bitget is yet to respond to ASIC’s statement
- Australia is gradually tightening its noose around crypto activities as it mulls on a comprehensive regulatory approach
The Bitget crypto exchange has found itself under a regulatory spotlight in Australia as the nation tightens noose around crypto-related operations. The Australian Securities and Investments Commission (ASIC) on Monday, July 28, flagged Bitget’s crypto futures products as “unlicensed” — warning citizens against engaging with these financially risky offerings.
In its warning statement, the ASIC said that Bitget’s futures products allow investors to speculate on future movements in crypto prices, making them highly-risky.
“To protect retail investors, ASIC limits leverage ratio limits for certain cryptocurrency derivative products at 2:1. However, Bitget’s unlicensed products are available at up to 125:1 leverage. For every dollar invested at this leverage rate, there is potential for 125 times magnified gains or losses for investors,” the agency explained.
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ASIC points out lapses in Bitget’s operations
Bitget, as highlighted by the ASIC, does not currently hold an Australian Financial Services (AFS) license. Owing to the lack of this permission, the exchange is not legally permitted to promote its financial products in the country.
The ASIC has notified Australian crypto investors that engaging with
unlicensed financial products are not legible to access the rights and protections laid out under the country’s financial services laws including internal dispute resolution processes or client money protections, in case something goes wrong.
“ASIC encourages all investors to do your own research on people, companies and investments. Trading in highly leveraged derivative products can result in substantial losses for investors,” the statement added.
Australia is in the process of analyzing the pros and cons around embracing the crypto industry. In March, ASIC started working on proposing regulations around crypto exchanges, custody services, and brokerage firms. Meanwhile, the country is trying to curb the instances of crypto-related financial losses to protect its investor community. It has capped crypto ATM transactions to AUD 5,000 to cut down potential cases around money laundering and scams.
Bitget’s recent history
Bitget’s response to the ASIC’s statement remains awaited for now. While it seemingly faces a touch ordeal in Australia in the coming days, the exchange has been making strides in other parts of the world.
In May, for instance, the exchange launched its own yield-bearing stable asset called the BGUSD.
The exchange also recently partnered with Mastercard to launch zero-fee crypto cards in the UK as well as across the EU region.
