ASIC bans director over cryptocurrency fund misconduct

ASIC has disqualified Ashod Ohan Balanian, of North Ryde, New South Wales, from managing corporations for the maximum period of five years due to his involvement in three failed companies that operated a cryptocurrency fund.

Between May 2017 and May 2024, Mr Balanian was the director of Digital Commodity Assets Pty Ltd (Digital Commodity), DCA Capital Pty Ltd (DCA Capital), and Polychain Pty Ltd (Polychain). Digital Commodity and DCA Capital acted as trustees for a cryptocurrency fund called the Digital Commodity Assets Fund (DCA Fund), while Polychain became the investment manager for the DCA Fund on 12 November 2022.

Information Memoranda for the DCA Fund stated that it was a wholesale investment fund that sought to exploit price differences between exchanges for a certain cryptocurrency.

ASIC findings on director misconduct

ASIC found that Mr Balanian engaged in serious misconduct and failed to meet his obligations as a director across the three companies. The regulator determined that he:

• failed to lodge a Report on Company Activities and Property with the Liquidators;
• failed to provide assistance and documents to the Liquidators;
• failed to ensure that Polychain kept adequate books and records;
• failed to exercise due care and diligence to ensure that Digital Commodity and DCA Capital met their obligations to lodge income tax returns and business activity statements;
• failed to exercise due care and diligence to ensure that Digital Commodity and DCA Capital complied with their obligations to register the DCA Fund as a managed investment scheme; and
• failed to ensure that DCA Capital held an Australian financial services license (AFS licence) or was an authorised representative of an AFS licence holder.

ASIC concluded that Mr Balanian showed a willingness to ignore his obligations as a director and allowed the companies to operate without complying with their obligations, thereby putting investors at risk.

Disqualification period and ongoing investigation

As a result of these findings, ASIC has disqualified Mr Balanian from managing corporations until 30 March 2031.

An investigation by ASIC relating to the affairs of Digital Commodity, DCA Capital and Polychain is continuing.