Financial Service Categories Under Chapter 7
Once your product is a 'financial product', the next question is which financial service you provide.
Once your product is a 'financial product', the next question is which financial service you provide. That decides your AFSL authorisation categories.
s 766B: Financial product advice
General or personal recommendations about crypto tokens that are financial products. Includes: research reports, token ratings, portfolio recommendations.
- Trigger: a recommendation or statement of opinion that is intended to influence a decision about a financial product, or could reasonably be regarded as intended to do so.
s 766C: Dealing in a financial product
Applying for, acquiring, issuing, varying or disposing of a financial product, and arranging for someone else to do so. Covers:
- Token issuance (ICO/TGE)
- Arranging trades for clients (operating a trading venue may instead require an Australian market licence: s 767A, s 791A)
- Arranging secondary market trades
s 766D: Making a market
Regularly stating prices at which you will acquire or dispose of financial products on your own behalf, where others reasonably expect to transact at those prices.
- Exchanges that quote their own prices, OTC market makers and, possibly, AMM protocols with identifiable operators (see the open question below).
s 766E: Custodial or depository service
Holding financial products on behalf of another.
- Custodial wallets, institutional custody, exchange wallets holding user funds.
s 766F: Crowd-funding service
- Publishing a CSF offer document for a crowd-sourced funding offer of a company's securities under Part 6D.3A, and taking applications.
Practical impact: A single crypto business may trigger three or four of these at once. Your AFSL application must cover each financial service you provide.
s 766A to 766F: statutory detail and crypto application
s 766A: Providing a financial service
This is the definitional provision. Under s 766A(1) you provide a "financial service" if you provide financial product advice, deal in a financial product, make a market, operate a registered scheme, provide a custodial or depository service, provide a crowd-funding service, or engage in certain other listed or prescribed conduct. Operating a financial market or a clearing and settlement facility is not in that list. It is regulated separately, under the market and CS facility licensing regimes in Part 7.2 and Part 7.3. s 766A matters because it is what links conduct to the AFSL requirement in s 911A. Conduct can be more than one financial service at once (s 766A(5)).
s 766B: Financial product advice
There are two sub-categories, with very different compliance burdens:
General advice (s 766B(4)): A recommendation or opinion about a financial product that is not personal advice. When given to a retail client, the provider must give a general advice warning (s 949A).
- Crypto example: A DeFi analytics platform that publishes "Token X is undervalued based on TVL metrics" gives general advice if Token X is a financial product.
Personal advice (s 766B(3)): The provider has considered one or more of the client's objectives, financial situation and needs, or a reasonable person might expect them to have done so.
- Crypto example: A robo-advisor that asks for your risk tolerance and then recommends a portfolio of tokenised managed funds gives personal advice. For retail clients, that triggers the best interests duty (s 961B) and the appropriate advice obligation (s 961G).
The trap for crypto: Many platforms sit close to the line. If your UI asks users any questions about their goals before presenting products, ASIC may characterise the output as personal advice, even if you call it "general." One narrow carve-out: asking questions solely to work out whether someone is in a product's target market, and telling them the result, is not of itself personal advice (s 766B(3A)).
s 766C: Dealing in a financial product
Section 766C(1) lists the conduct (whether as principal or agent):
- Applying for or acquiring a financial product
- Issuing a financial product
- For securities and MIS interests, underwriting them
- Varying a financial product
- Disposing of a financial product
Two capacities:
- Dealing on own behalf: a person dealing on their own behalf is generally taken not to deal, unless they are an issuer dealing in its own products (s 766C(3))
- Dealing on behalf of another: acting as agent/intermediary (broker, exchange matching engine)
Crypto applications:
- Token issuer conducting a TGE: issuing, on its own behalf
- DEX aggregator routing swaps through liquidity pools: arguably acquiring or disposing on behalf of another
- Exchange operator matching buyer and seller: arranging acquisition and disposal, on behalf of another
- Staking-as-a-service where the provider stakes on your behalf and returns yield = potentially dealing (including varying) if the staking arrangement itself is a financial product
Arranging is dealing: Under s 766C(2), arranging for a person to engage in any of that conduct is also dealing in a financial product, unless the actions amount to providing financial product advice. INFO 225 makes the same point. Introducing, referral and "facilitation" models therefore need to be checked against s 766C(2), not just s 766C(1). Note also that providing a crowd-funding service is not dealing (s 766C(2A)).
s 766D: Making a market in a financial product
A person makes a market if, through a facility, at a place or otherwise, they regularly state the prices at which they propose to acquire or dispose of financial products on their own behalf, and other persons have a reasonable expectation that they will be able to regularly effect transactions at those prices (s 766D(1)).
Two elements:
- Regularity of price statements: systematic, not one-off
- Reasonable expectation that others can transact at those prices
Crypto applications:
- CEX with order book where the exchange itself places standing bids/asks (proprietary trading) = market making
- AMM protocol operator: this is the open question. The protocol algorithmically quotes prices, but is the operator/deployer making a market? ASIC hasn't published definitive guidance (INFO 225 expressly does not comment on DeFi licensing), but the logic is: if an identifiable entity deploys, controls parameters (fee tiers, concentrated liquidity ranges), and profits from the spread, they look like a market maker
- OTC desks quoting firm two-way prices to institutional counterparties = clear market making
- Passive liquidity providers on an AMM: likely not market makers individually (they're depositing assets into a pool, not quoting prices), but the pooled mechanism as operated by its controller may be
s 766E: Custodial or depository service
A person provides this service if, under an arrangement, a financial product or a beneficial interest in a financial product is held by the provider in trust for, or on behalf of, the client or someone the client nominates (s 766E(1)).
Crypto applications:
- Custodial exchange wallets: if a user deposits crypto that is a financial product and the exchange holds it on the user's behalf, that is a custodial service
- Institutional custody services for AU-regulated products = custodial service
- Smart contract escrow: if an identifiable party controls the escrow contract and holds assets on behalf of transacting parties, arguably custodial. If the contract is fully autonomous with no controller, the analysis is less clear
- Non-custodial wallets (user holds keys): generally not a custodial service, because no one holds assets on behalf of another
Exclusions (s 766E(3)) include operating a CS facility, operating or holding the assets of a registered scheme, superannuation trustees, and services to a related body corporate. There is no general 'incidental holding' exclusion. "Incidental custody" is relevant to ASIC's net tangible assets requirements for custodians (RG 166). INFO 225 says a custodian typically needs at least $10 million in net tangible assets, but where custody is 'incidental' the NTA requirement is $150,000 (or may be nil if you do not hold physical custody), referring to Table 15 in RG 166.
s 766F: Crowd-funding service
A person provides a crowd-funding service if a CSF offer document for a CSF offer of a company's securities is published on a platform the person operates, and applications may be made to the person for the issue of the securities (s 766F(1), Part 6D.3A).
There are strict requirements. The issuer must be an eligible CSF company, which among other things requires consolidated gross assets and annual revenue each under $25 million unless the regulations prescribe otherwise (s 738H). The offer is subject to a $5 million issuer cap over 12 months (s 738G(2)), and the platform operator must hold an AFSL authorising it to provide crowd-funding services.
Crypto application: Token launchpads hosting capital raises where the token is a security (equity token or debenture). If the token meets the Corporations Act definition of a share or debenture, and the raise is structured as a CSF offer through a platform, this provision potentially applies. INFO 225 notes that an ICO is not a CSF offer just because it is described as "crowd funding".
Limitation: Most utility token sales won't trigger s 766F because the token isn't a share or debenture. Tokenised equity raises (e.g., issuing tokens representing shares in an AU company) are within scope only if they are made as CSF offers under Part 6D.3A.
Coming in 2027: new digital asset authorisations
The Corporations Amendment (Digital Assets Framework) Act 2026 creates new categories for digital asset platforms and tokenised custody platforms. The Act commences on 8 April 2027. ASIC's CP 392 (15 October 2026) proposes that existing operators apply by 7 October 2027 and can keep operating while ASIC assesses their application. Platform businesses should map their services against both the current s 766A categories and the new authorisations.
Practical Mapping for AFSL Applications
| Business Model | Likely Authorisations Needed |
|---|---|
| Crypto exchange (custodial) | Dealing (s 766C) + Custody (s 766E) + possibly Market Making (s 766D) + possibly an Australian market licence (s 791A); from 8 April 2027, possibly a digital asset platform authorisation |
| DeFi analytics/ratings | Advice: general (s 766B) |
| Robo-advisor for crypto | Advice: personal (s 766B) + Dealing (s 766C) |
| Token launchpad | Dealing, including arranging (s 766C) + possibly Crowd-funding (s 766F) |
| OTC desk | Dealing (s 766C) + Market Making (s 766D) |
| Institutional custody | Custody (s 766E); from 8 April 2027, possibly a tokenised custody platform authorisation |
| Staking-as-a-service | Dealing (s 766C) + possibly Custody (s 766E) |
Key ASIC Guidance:
- RG 36: Licensing, financial product advice and dealing
- INFO 225: Digital assets, financial products and services (updated October 2025)
- RG 104: AFS licensing, meeting the general obligations
- RG 166: AFS licensing, financial requirements (custody NTA)
- CP 392: Implementing the new digital asset laws (consultation; feedback due 27 November 2026)
- Corporations Amendment (Digital Assets Framework) Act 2026: new digital asset platform and tokenised custody platform products from 8 April 2027
This is general information, not legal advice.
Questions? Email [email protected].
Sources
- Corporations Act 2001 (Cth), current compilation (C2026C00432, compilation date 19 Sep 2026): https://www.legislation.gov.au/C2004A00818/latest
- ASIC INFO 225, Digital assets: financial products and services (updated Oct 2025; minor edits Apr 2026): https://www.asic.gov.au/regulatory-resources/digital-transformation/digital-assets-financial-products-and-services
- ASIC CP 392 (15 Oct 2026): https://download.asic.gov.au/media/0pqj5lgc/cp392-published-15-october-2026.pdf
- ASIC 26-245MR (15 Oct 2026): ASIC consults on implementation of new digital asset laws: https://www.asic.gov.au/about-asic/news-centre/find-a-media-release/2026-releases/26-245mr-asic-consults-on-implementation-of-new-digital-asset-laws
- Corporations Amendment (Digital Assets Framework) Act 2026 (No. 38 of 2026), Federal Register of Legislation: https://www.legislation.gov.au/C2026A00038/asmade