Switzerland becomes the first major financial hub with a full set of regulations governing the blockchain and cryptocurrency industry, after the Senate approved regulations to facilitate the use of digital assets and decentralized finance.
The Swiss Senate approves the "Blockchain Act"
Switzerland has adopted extensive regulations this week, opening the door to cryptocurrencies and decentralized finance (DeFi). Reforms of financial and corporate law adopted by parliamentarians in the Swiss Senate complement the so-called "Blockchain Act," which received great approval in the Swiss House of Representatives during the summer.
It is expected to enter into force early next year and "will provide Switzerland with the most advanced regulatory framework for blockchain technology in the world". The new legal code covers the exchange of digital securities, sets standards for cryptocurrency exchanges and solves money laundering problems, legitimizing an industry that many fear.
Overall, it will create one of the most favourable regulatory conditions in the world. It will allow the Swiss financial center to lead the digital asset space and hopefully attract new companies to the Crypto Valley.
- said Urs Bolt of ti&m.
As Adriana Hamacher from Decrypt points out, although Switzerland is not the first country to introduce extensive regulations on cryptocurrencies and blockchain technology - previously, among others, neighboring Liechtenstein and Malta done this - it is the first major financial center to do so.
After Liechtenstein passed the Blockchain Act last year, which came into force in January of this year, the Swiss government had to act quickly to pass its own law in order to maintain its leading position as the most crypto-friendly country in the world.
- said Stefan Deiss, founder and CEO of Blockchain Propulsion.
But unlike Liechtenstein, Switzerland did not need to create new legislation, given its regulatory flexibility, so the existing legislation only had to be changed - and will probably be changed again as the sector develops.
Switzerland as home to hundreds of blockchain and crypto companies
Called Crypto Valley, the Swiss canton of Zug is the epicenter of the flourishing Swiss blockchain and crypocurrencies industry. In recent years, the country has become home to over 900 companies due to numerous legal, regulatory and tax advantages.
Among other things, non-profit foundations that manage leading blockchain platforms such as Ethereum, Cardano and Tezos have their headquarters in Switzerland. There are also well-known crypto banks Seba and Sygnum, dozens of asset management companies and the Libra Association, which is responsible for the ambitious Facebook project, the Libra payment network.