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The Australian Securities and Investments Commission (ASIC) on Thursday published its four-year plan for companies from 2021 to 2025.

which prioritizes the distribution of retail over-the-counter derivatives, particularly in relation to Contracts for Difference (CFDs) and binary options.

 

ASIC monitors the financial markets

The committee noted three main actions regarding its intervention in the OTC retail derivatives industry, and said it would monitor compliance with CFDs and orders to intervene in the binary options product.

Although Australia has remained a desirable market for forex and CFD brokers, ASIC has introduced several regulations for the industry in recent months and has followed in the footsteps of the European Securities and Markets Authority (ESMA) lowering the maximum leverage from 500:1 to 30:1 Along with some other limitations.

 

Additionally, the Australian watchdog imposed an 18-month ban on the retail sale and distribution of binary options in April and will decide later whether to extend the ban or make it permanent.

It assessed the effectiveness of the orders in minimizing damage, areas of potential avoidance, and whether the orders should be extended as the second major action.

Additionally, ASIC has become vigilant in the financial services industry and is actively taking action against any regulatory violations.

Including enforcement actions where necessary, to address misconduct as the third key action shows a willingness to intensify market surveillance.

 

Zero tolerance policy

The agency has kept its OTC retail derivatives market under the phase 2 priority level.

The authority confirmed that it will use the regulatory tool to supervise and enforce any procedures against violators.

 

Meanwhile, the agency is now focusing on the booming cryptocurrency industry and has issued a warning against unlicensed exchanges offering services to Australian traders.

"We will continue to seize opportunities to support business through more efficient regulation, while at the same time, we will continue to be vigilant in protecting consumers and investors from harm," the ASIC Chairman stated.