Bitcoin is no longer considered as an illegal investment method anymore. Every other country is recognizing crypto and blockchain technology these days. Switzerland has also become one of such countries.
Recently, the Swiss parliament has made amendments in the finance and corporate laws. The change has been made regarding the crypto and blockchain industry. The government has made changes into several laws related to secure trading, bankruptcy, and more.
The latest law defines how cryptocurrency exchanges will work against eliminating money laundering frauds. This law also explains the legal steps that involve exchanging digital securities. It also defines how digital assets will be reclaimed if a crypto company becomes bankrupt.
In short, it mentions every legal requirement for running a cryptocurrency exchange. These laws are not made public for the first time. It is based on the amendments to the “Blockchain Act” passed by the members of the House of Representatives. The “Blockchain Act” will come into effect from the beginning of next year.
The cryptocurrency and blockchain industry can expect gains in Switzerland due to this new crypto-related law. Switzerland has many crypto and blockchain-related companies. With more than 900 companies, Switzerland has a fair share in the crypto market. 4,700 people are working with Facebook’s Libra alone.
Switzerland has become a crypto nation in the past year. It has hundreds of crypto companies, crypto banks, real estate ventures, several blockchains, asset managers, digital stock exchanges, and many more crypto-related projects.
Switzerland is a beautiful country mainly known for its luxury goods, alpine landscapes, and more. Apart from its beauty, Switzerland has also proven its contribution to the banking and finance industry. It is also one of the few countries that quickly adopted cryptocurrency and blockchain technology.
Switzerland’s government is experimenting with blockchain and crypto technology since its inception. Many sectors including public and private are on the way to adopt this technology for their operations.
When it comes to private cryptocurrency banks, the beautiful country found its first bank in 2019. Sygnum and Seba Crypto AG are the first cryptocurrency banks of the country that has a Swiss banking license. This license is authorized by the Swiss Financial Market Supervisory Authority.
With this new license, these cryptocurrency firms have set up a trading platform and digital asset platform. These platforms will be used by professional traders, institutions, and firms.
Signum has offered digital assets to the Swiss market for example, people can now trade or invest in Bitcoin (BTC) and Ether (ETH). Regulatory approval has been proven to be beneficial for crypto firms and the country alike. Since it has now opened the doors of digital asset transactions and investment to the Swiss people.
The Swiss Financial Market Supervisory Authority or FINMA released guidance on blockchain-related transactions in 2019. The guidance applies to crypto exchanges, trading platforms, and digital wallet providers. FINMA guidelines are also pointing out that crypto-related businesses are no exemption when it comes to anti-money laundering and KYC requirements.
Since digital currency is also an asset, it is obvious that crypto firms and blockchain businesses should follow the law. Every digital asset handling should be done under the regulatory schemes of the Swiss government. The firms should also work concerning money laundering or at least prevent it.
Fiat banks have constantly been worried about the threat of digital money, thus they never tried to adopt cryptocurrency and blockchain technology. But now that a separate crypto bank has emerged, it has created a sense of competition between the private banks and cryptocurrency banks.
Credit Suisse and UBS are finding new ways to settle trades quickly. One of the parts of this discovery is testing how DLT trading can be made faster. SEBA crypto bank along with the Julius Bär is issuing cryptocurrency trading certificates on the Swiss stock exchange.
Private banks including Maerki Baumann and Arab Bank Switzerland offer cryptocurrency facilities only to wealthy clients. They provide the services through intermediaries such as Metaco, Bitcoin Suisse, and Tauras.
The digital assets make it possible for the companies to have a digital-only form of assets of the company. Thus, there’s no need for paper and other formalities. The digital trades can be settled instantly, it means no time will be wasted if this technology takes into effect.
But this new technology is different from the traditional financial sector. So, it will take some time to adapt to the changes formally. That’s why it is decided to officially apply the law next year. Once applied, it will be easier to protect the transactions between the consumer and the company.
The changes in the Swiss laws are made to create a digital version of the real estate holdings, company shares, and other assets that are available to be traded on blockchain technology. The effects of the Swiss legal code are yet to be seen in the crypto and blockchain industry.