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The Swiss federal government is looking to improve its existing financial market regulation that will oversee the crypto industry in the future. The Federal Council met yesterday, Nov. 27, to discuss the current regulatory framework.
The council has been reviewing this nascent industry since last year and has made considerable headway on their endeavor in creating a sound legal framework. Members of the council found that although current legal regulation is “well suited” to handle the rise of the crypto market, there are some areas that need amendments.
In March, the council proposed 80 amendments to existing legislation during the consultation process. Those proposals cover nine federal acts, encompassing both the civil and financial market law, with the revised proposal expected to be reviewed by parliament in early 2020. These amendments are mostly focused on three things.
Improvements that are being made
The first is legal certainty. Since the crypto market is still relatively young, it needs solid governance to ensure that businesses operating within its scope are guided and monitored accordingly. A poor legal framework can result in a lot of headaches, case-in-point the current debacle between Telegram and the Securities and Exchange Commission.
The second is the removal of barriers for the application of digital ledger technology (DLT). This innovation has proven to be quite effective in streamlining the services of government and private businesses and can save millions of dollars in operational cost. The Federal Council aims to shape the regulatory framework that will encourage growth while ensuring that the technology can still be controlled.
Lastly, the regulation will make more adjustments in the risk factors that come with blockchain and DLT. This means a more robust approach to the anti-money laundering law (AML) and Know-Your-Customer (KYC) regulation.
The crypto race trudges on
Switzerland is taking all these steps to ensure that its current position as one of the leading countries cultivating the crypto industry remains secure. Its Zug region has already established itself as a crypto-friendly area resulting in the proliferation of crypto businesses in the country.
Switzerland is also preparing itself to deal with the Geneva-based Libra stablecoin, which is still being highly scrutinized today as it poses a big risk towards central banks. Mark Branson, director of the Financial Market Authority (FINMA), said that although Libra obviously has risks associated with it, there are also advantages that it offers, CoinDesk reported.
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