Federal Court orders BPS Financial to pay $14 million in penalties over “Qoin Wallet” crypto product
Tiahna Cassar
On 27 January 2026, the Federal Court of Australia found in the case of Australian Securities and Investments Commission v BPS Financial Pty Ltd (Penalty) [2026] FCA 18 that BPS Financial Pty Ltd (BPS Financial) pay $14 million in pecuniary penalties over its ‘Qoin Wallet’ crypto currency product. The Court found that BPS Financial engaged in serious and unlawful misconduct during the period from January 2020 until mid-2023 and had published false and misleading representations about the ability of Qoin Tokens to be exchanged for fiat currency and other crypto-assets, the growing number of Qoin merchants, and the official approval and registration status of the Qoin Wallet.
The Australian Securities and Investments Commission (ASIC) commenced proceedings against BPS Financial in 2022, alleging it made false, misleading, or deceptive representations and alleged BPS Financial did not have an Australian financial services licence (AFSL).
BPS Financial advertised Qoin as a digital currency that could be traded exclusively on the Block Trade Exchange. BPS Financial also claimed that Qoin could be used to buy goods and services from numerous Australian businesses. According to Federal Court documents, approximately 96,000 Qoin accounts (referred to as ‘Qoin Wallets’) were issued.
In addition to the pecuniary penalties, Justice Kylie Downes of the Federal Court also ordered:
BPS Financial be permanently restrained from making any false or misleading representation concerning the number of holders of the Qoin Wallet, the ability of Qoin Tokens to be exchanged for fiat or other crypto-assets, and that the Qoin Wallet has been officially approved and/or officially registered;
BPS Financial be restrained for 10 years from carrying on a financial services business without holding an AFSL;
BPS Financial publish an adverse publicity notice on the Qoin Wallet application and take steps to request the publisher of the ‘qoin.com’ website to also publish an adverse publicity notice; and
BPS Financial pay most of the costs incurred by ASIC for the proceeding.
ASIC Chair Joe Longo stated that the judgement sends a strong deterrence message to the crypto industry. Longo affirmed that, ‘given the nature of these products, providers must have the appropriate licenses and authorisations, and investors must be able to make decisions based on clear and correct statements, especially as crypto products can be highly volatile, inherently risky and complex.’
Longo further notes that, ‘the digital asset industry is well on notice that its products will continue to be a focus for ASIC.’ The outcome of this case therefore reflects the seriousness with which courts and ASIC expect entities to comply with financial services regulation. According to ASIC Deputy Chair Sarah Court, deterrence is a key component of ASIC’s enforcement plan.
ASIC has released Information Sheet 225 (INFO 225) directed to businesses and people offering products in relation to digital assets and helps understand obligations under the Corporations Act 2001 (Cth) (Corporations Act) and the Australian Securities and Investments Commission Act 2001 (Cth). INFO 225 provides guidance as to whether a digital asset, or a related product, is classified as a ‘financial product’ under section 763A(1) Corporations Act. If so, the issuer of the financial product must comply with the relevant provisions of the Corporations Act, including AFSL requirements. Under section 911A(1) Corporations Act, a person who provides financial services in Australia must hold an AFSL covering the provision of the financial services.
The Treasury’s proposed new digital asset platform and tokenised custody platform legislation is the most recent milestone in a string of complex changes to the financial services sector. Businesses involved in digital assets should stay alert to significant regulatory changes in 2026, including INFO 225 and draft legislation proposing to amend the AFSL regime under the Corporations Act to cover digital asset activities (refer to the Treasury Laws Amendment (Regulating Digital Asset, and Tokenised Custody, Platforms) Bill 2025).
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Commentary: https://www.abc.net.au/news/2026-01-29/cryptocurrency-qoin-company-fined-14m-misleading-conduct/106278720