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Switzerland To Amend Existing Financial Laws To Regulate Crypto And Blockchain Technologies

Legal

www.ethnews.com 17 December 2018 17:39, UTC
  
Reading time: ~2 m

Switzerland's Federal Council, a seven-member executive council that makes up part of the country's government, on December 14 outlined a series of planned changes to the Swiss legal framework and its ability to "deal with new technologies including blockchain" and, more generally, distributed ledger technology (DLT). The Council wants to see a set of adjustments to existing financial laws, including the monitoring and review of the potential risk of money laundering and terror financing through digital assets.

According to the press release, a blockchain/ICO working group set up by the Swiss Federal Department of Finance (FDF) analyzed the Swiss FinTech and finance sector and found no need for fundamental adjustments to current financial laws. The Federal Council, however, asked that the FDF and the Federal Department of Justice and Police (FDJP) continue to work toward better legal clarity for holders of digital registers.

More specifically, in a report published by the Federal Council last week, the regulators wrote that they hoped to see proposed changes to the country's Financial Market Infrastructures Act and the Financial Institutions Act that will "[create] more flexibility to better meet the needs of blockchain/DLT applications."

Regarding the country's anti-money laundering (AML) laws, the release notes that the Interdepartmental Coordination Group on Combating Money Laundering and Terrorist Financing found a low number of Swiss cases in which crypto-based assets posed a threat to money laundering and terrorist financing. Again, the Federal Council mandated the FDF to continue to improve the country's AML legislation, and examine whether it should be "adjusted in relation to certain forms of crowdfunding."

Early in December, Switzerland's Financial Market Supervisory Authority (FINMA), the country's financial regulator, announced a series of new requirements for blockchain- and cryptocurrency-based firms applying for a FinTech license that will go into effect on January 1, 2019. The new requirements will make it easier and quicker for companies to receive FinTech licenses.

More recently, Gazprombank (Switzerland) Ltd. partnered with FinTech start up Avaloq and crypto firm METACO to begin offering cryptocurrency-linked banking services in 2019.


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