AFS Licensing Requirement

Definition ∞ An AFS Licensing Requirement mandates financial service providers to hold a specific license in Australia. An Australian Financial Services (AFS) license is a regulatory authorization issued by the Australian Securities and Investments Commission (ASIC). This license permits entities to provide financial product advice, deal in financial products, make a market for financial products, operate a registered scheme, or provide custodial or depository services. For digital asset firms, determining if their activities constitute a financial service requiring an AFS license is a key regulatory consideration.
Context ∞ The application of AFS licensing requirements to cryptocurrency businesses remains a prominent regulatory concern in Australia. Regulators continue to assess whether various digital assets and related services fall under existing financial product definitions. News frequently covers policy discussions and enforcement actions related to entities operating without proper AFS authorization in the rapidly evolving digital asset sector.