- Swiss authorities passed the ‘blockchain law’ in record time for regularising cryptocurrency and digital securities industry
- It would lead to faster trading, reduction in costs, and an expanded range of products
Switzerland has known to be friendly to account holders around the globe. Their rules and regulations distinguish them from the other nations. The launching of crypto asset and blockchain laws has been greeted gracefully across the growing industry.
What Regulations are implemented?
The new blockchain regulations were passed last year to be implemented in 2 phases. First is the company law reforms by February 1st. And the other is the financial market infrastructure upgrades from the beginning of August. Gradual implementation will ensure a fully regulated cryptocurrency and transparency of the digital securities industry whereby all the participants are aware of their positioning and risks associated. It would bring in improved efficiency across a wide range of products to more participants.
Firms in the Race to Extract Benefits
Companies are not wasting any time in announcing their digital assets and are positioning themselves to gain a ‘first mover’ competitive advantage in the competitive world of DLT (distributed ledger technology) finance. Three companies, namely SEBA, Signum Banks, plus Crypto Finance, have made announcements pertaining to the same. Crypto Finance has been awarded a securities house license by FINMA (Swiss Financial Market Supervisory Authority) and can now enable clients to trade a new breed of digital securities, including company shares and potential alternative assets such as luxury goods, tokenized real estates and various collectibles.
Signum has tokenized a range of premium wines from Fine Wine Capital on its platform, which was launched last year.
SEBA has converted resulting participation certificates into digital shares that can be traded on blockchain exchanges. It’s a critical stage for the firm since it had raised CHF20 million from investors at the close of the previous year.
Several other established entities such as Swiss Digital Exchange (SDX) and Bitcoin Suisse have either applied for FINMA licenses or expressed their interest. Different firms are poised to issue digital assets through the banks, including real estate and shares in an electric manufacturer.
Despite companies’ mounting interest in DLT compatible securities, the network of platforms they are to be traded is still missing. This vacuum is anticipated to be addressed as the year progresses and technological improvements play an important role. The current regulations are expected to position Switzerland as one of the most innovative and progressive legal and regulatory jurisdictions across the world that completely supports the issuance of digital securities on a native blockchain basis.
Switzerland might be one of the first nations to codify digital assets into national law comprehensively, but the race to build the new generation of innovative financial companies and infrastructures is still wide open to rapid competition.