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According to a press statement, Australia's financial services and markets regulator has restricted Sydney-based asset manager Holon Investments' ability to sell or distribute three crypto funds to individual investors for 21 days. The reason behind the suspension was non-compliant target market determinations (TMDs). A target market determination (TMD) is a statement that outlines the demographics for whom a product is suitable, considering potential requirements, goals and financial circumstances, and distribution options.
Holon's Crypto Funds
The funds, known as the Holon Bitcoin Fund, the Holon Ethereum Fund, and the Holon FileCoin Fund, are all managed investment plans that attempt to provide access to the value of the respective cryptocurrency and operate by investors pooling funds in exchange for a relative share in the scheme. According to the Australian Securities and Investments Commission (ASIC) statement, Holon's crypto funds are not suitable for the broad target group indicated in their TMDs, which includes investors with possibly medium, high, or very high risk and return profiles. The funds held by Holon in Bitcoin, Ether, and Filecoin are affected by the restriction. The cryptocurrency exchange Gemini oversees the management of all three funds.
Interim Orders Imposed By ASIC
The interim orders imposed by ASIC said that they would remain in force for 21 days unless removed early to prevent retail investors from participating in funds that would not be appropriate for their financial aims, circumstances, or requirements. The nature of the changes that ASIC has asked Holon to make is unknown, and the ASIC spokeswoman gave no more information. The temporary suspension would restrict Holon from disclosing a PDS, giving broad recommendations for the funds, or offering shares of the funds to retail investors. The regulator also anticipates that Holon would respond to the issues punctually. However, Holon would be allowed to submit arguments before an order is passed.