The country’s Federal Council recently issued a ‘report‘, providing a legal framework for DLT [Distributed Ledger Technology], or blockchain, stating that Switzerland’s existing rules are compatible to deal with such new emerging technologies, however there’s still a necessity for a few new amendments.
Firstly, the council has projected a change within the country’s security regulations to extend the legal certainty of crypto tokens. “Since an entry in a very decentralized register accessible to interested parties can produce publicity almost like the possession of a security, it looks even to connect similar legal effects to this entry,” the renowned executive authority of the Swiss Confederation explained.
The council conjointly desires to segregate crypto assets from the insolvent debtors’ total estate in bankruptcy proceedings. However, as a result of underneath the country’s existing DEBA [Debt Enforcement and Bankruptcy Act] is not clear whether or not these assets are separate, the council] aforesaid there’s a great requirement for a legal certainty for the parties concerned and therefore a corresponding modification is projected within the DEBA act.
Further, the govt. body has projected the creation of a replacement “authorization category” for infrastructure suppliers within the blockchain sector, and would make amendments to its Monetary Market Infrastructure Act consequently. Currently, the council has not nevertheless projected any specific changes, as the central definitions of the terms “securities” and “derivatives” in Financial market laws also are relevant for blockchain-based business models, it said.
Regarding the country’s Anti-Money Laundering Act, the council aforesaid the legislation is presently adequate enough to conjointly cover activities associated with cryptocurrencies along with ICOs [initial coin offerings]. “The general principles of the Anti-Money Laundering Act conjointly apply to crypto-based assets.” it said, adding that there’s no requirement for any “fundamental revision” for now.
The Swiss govt. has been ‘engaged‘ on blockchain laws since 2016, after the country’s Federal Department of Finance outlined its plans to control fintech. Earlier in 2017, the council itself was seeking consultations on regulative changes for the domestic monetary business to account for fintech as well as blockchain.
Most recently, Switzerland’s FINMA [Financial Market Supervisory Authority] introduced a new fintech license with “relaxed” needs that’s applicable to blockchain and cryptocurrency-based corporations.