ASIC Warns Bitget Over Unlicensed Crypto Futures, 125:1 Leverage Exceeds 2:1 Cap

The Australian Securities and Investments Commission (ASIC) has issued a stern warning against cryptocurrency exchange Bitget, alleging the platform is offering unlicensed crypto futures products to Australian investors without holding an Australian Financial Services (AFS) license. This move highlights the regulator’s heightened scrutiny of unregulated financial services in the digital asset space and underscores the risks posed by high-leverage derivatives. Bitget is accused of providing crypto futures with leverage of up to 125:1, far exceeding the 2:1 cap imposed on licensed Australian platforms, exposing retail investors to rapid capital depletion and minimal legal recourse [1].

ASIC emphasized that unlicensed platforms like Bitget deprive investors of critical safeguards, including segregated client funds, transparent operational practices, and independent dispute resolution mechanisms. The regulator warned that such services operate outside established regulatory frameworks, leaving users vulnerable to fraud, insolvency, or unfair trading practices. The warning aligns with a broader global trend of regulators intensifying oversight of crypto markets to mitigate systemic risks and protect consumers [2].

The risks associated with unlicensed crypto futures are multifaceted. High leverage, such as Bitget’s alleged 125:1 ratio, amplifies both potential gains and losses, with even minor price movements risking total capital loss. Additionally, the absence of investor protections means clients cannot access compensation schemes or legal recourse if the platform fails. ASIC also highlighted the lack of transparency in unregulated operations, which can obscure financial health and trading practices, further increasing fraud exposure [3].

For Australian investors, ASIC urged due diligence in verifying a platform’s licensing status through its Professional Registers. Regulated platforms must adhere to legal leverage caps and provide clear risk disclosures, client fund protections, and dispute resolution processes. The regulator’s warning serves as a cautionary signal to avoid platforms offering unsustainably high leverage or making aggressive marketing pitches for unlicensed products [4].

The implications of ASIC’s action extend beyond Bitget. It signals a growing regulatory focus on cross-border crypto services that circumvent local licensing requirements. Global regulators are likely to adopt similar measures, pressuring exchanges to comply with jurisdictional standards or cease operations in specific markets. This could lead to a more fragmented but potentially safer crypto landscape, with increased clarity on derivatives and enhanced investor education campaigns [5].

ASIC’s intervention reflects its broader mandate to protect retail investors from high-risk, speculative products. While crypto innovation remains a priority, the regulator stressed that market integrity and consumer safeguards must not be compromised. The warning to Bitget reinforces the message that operating without proper licensing in Australia carries severe regulatory consequences and erodes trust in the financial system [6].

Source: [1] [title1Unlicensed Crypto Futures: ASIC’s Urgent Warning to Bitget Reveals Extreme Dangers] [url1https://coinmarketcap.com/community/articles/68872107361abe5ce4db1f24/]