Important Changes To Stablecoin Guidance / Regulation In Switzerland

The regulatory environment for cryptocurrency in Switzerland has undergone a massive change as a result of new guidance pertaining to stablecoin regulation issued by FINMA. In a memo published in June of 2024, the Swiss Financial Market Authority (FINMA), have drastically revised their approach to stablecoin regulation.

FINMA Now Requires a Bank License or Guarantee to Offer Stablecoins in Switzerland

Prior to this decision, FINMA relied upon a supplement to their ICO guidelines where an ad hoc approach to stablecoin regulation was taken. If the stablecoin represented a commodity, then established regulation for commodities would be followed; a stablecoin representing real estate would follow existing guidelines pertaining to such an asset, etc.

This approach changed in June with FINMA undertaking a far more stringent approach to the regulation of stablecoins in Switzerland. Going forward, one must either obtain a banking license or secure a bank guarantee in order to legally offer stablecoins in Switzerland. Such a drastic change in a short period of time poses a major setback to a region once known as a pioneer of cryptocurrency regulation and adoption.

FINMA Updates Stablecoin Guidelines – Anonymous Nature Removed

The news only gets worse for regulated cryptocurrency businesses and exchanges in Switzerland. As a final supplement to FINMA’s guidance, the anonymous nature of stablecoins has been removed. See the specific text from FINMA below: 

The stablecoin issuer is therefore considered a financial intermediary for the purposes of anti-money laundering legislation and must, among other things, verify the identity of the stablecoin holder as the customer in accordance with the applicable obligations (Art. 3 AMLA) and establish the identity of the beneficial owner (Art. 4 AMLA).  

In other words, any exchange looking to operate legally out of Switzerland must obtain KYC (Know Your Client) documentation for every user who wishes to acquire or transfer stablecoins to the exchange or trading platform.

Atomiq Consulting – Your Cryptocurrency Licensing Partner

With the introduction of ETFs in the Untied States, cryptocurrency is now globally recognized as a new asset class. As a result, regulators across the globe are taking advantage of the growth and opportunity this nascent industry can provide to what are still early adopters. Such stringent regulations will no doubt cause Switzerland to lose favorability to more flexible regulators in the months and years to come.

If you are looking to obtain cryptocurrency regulation in Switzerland or wish to explore alternative jurisdictions after this development, don’t hesitate to contact our team of consultants today!

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