Despite warnings from the Australian Securities and Investments Commission (ASIC) last year, digital investment platform Syfe and social investing network eToro have both begun offering ASX stocks to investors alongside crypto-assets.
Syfe claims to have become the first platform in Australia to provide investors with access to over 2,000 ASX equities and ETFs, US equities, and a “select range” of cryptocurrencies.
Meanwhile, eToro has announced that its users can now invest in some of Australia’s “most prominent listed companies”, after previously only offering ASX contracts for difference (CFDs). This adds to the company’s existing options of crypto and a range of other asset classes including ETFs, commodities and currencies.
In August last year, ASIC raised concerns about brokers offering crypto-assets alongside shares and other regulated financial products through their trading apps.
According to the regulator, this could give investors a deceptive sense of security, implying that cryptocurrencies possess the same safeguards as regulated financial products.
“Crypto-assets are high-risk, volatile, and complex. Brokers should think very carefully before offering crypto-assets through their share trading apps,” ASIC commissioner Danielle Press said at the time.
“The differences in risks and protections must be made clear to investors. We expect brokers to do the right thing by their clients.”
In a statement provided to InvestorDaily, Syfe said that it had set out to create a platform to provide Australian investors with one destination to help grow and manage their wealth.
“Together, our ASX and US offering forms the core of what we are providing Australian investors and while we also offer crypto on our platform, we have limited it to just 18 large-cap tokens (compared to a total universe of almost 22,000),” the company said.
Syfe explained that it incorporated disclaimers specifically related to cryptocurrency risks into its user experience and emphasised that its onboarding journey is exclusively geared to ASX and US investing.
“Clients who want to invest in crypto have to manually ‘opt in’. All clients are provided with information to understand the potentially higher risks of cryptocurrency trading before they can proceed,” Syfe said.
“In building our platform, we have a single-minded endeavour to simplify the complex wealth journey. By providing Australians with a single app where they can diversify their portfolio with a variety of assets, they can have the options and choices to achieve their long-term wealth goals.”
An eToro spokesperson told InvestorDaily that the company has a “strong regulatory review program in place and is cognisant of regulatory developments and regulator concerns around the world”.
“We are regulated by ASIC and by many other entities across the globe and have the appropriate licences for all products offered in each jurisdiction in which we operate,” they said.
According to the spokesperson, the offer of ASX shares is an extension of eToro’s existing offering of commission free international shares, which have been available since May 2020.
“The ‘new’ element here is that eToro is now offering the underlying asset i.e. ‘real’ ASX stocks whereas in the past these were offered as CFDs,” the spokesperson explained.
“This offering is commission free meaning that we do not charge any commission over and above the underlying market spread however other ancillary fees will apply.”
