According to a report , Swiss Federal Council has opted for minimal regulation. The report is based on the analysis conducted by a blockchain working team appointed earlier in 2018.
The report also concluded that the legal framework of Swiss can deal with the new technologies like blockchain with just some careful modifications being made and not the fundamental ones.
As per the report, the Swiss Federal Council as of now sees no fundamental problems regarding financial market regulation. The report highlights Switzerland’s financial market regulation is basically technology-neutral and it is able to handle new technologies.
According to the Swiss administration, the specific areas which require targeted changes are civil law, banking law, anti-money laundering law, and insolvency law. And in the civil regulation, the Swiss Federal Council has suggested that the legitimate certainty which involves the transfer of rights through digital registers should surge.
Swiss Federal Council with regards to financial market infrastructure regulation has called for a flexible and new authorization group focused solely on building blockchain/DLT-based financial market infrastructures.
Issues with Trading Platforms
The administration stated that such issues exist specifically in central trading platforms. Additionally, the issues persist in the application of financial market regulation to decentralized financial market infrastructures. Therefore it is more effective to address the issues in financial market infrastructure regulation.
The Swiss administration also introduced some changes in the insolvency regulation and called for clarification by considering the separation of digital currencies and other crypto assets in case of bankruptcy.
As per the Swiss Federal Council, there is ambiguity in cases where crypto assets are deposited with the third parties. Another issue arises where the debtor claims to discard such assets.
Apart from these, the Swiss Federal Council also introduced amendments to some areas that include anti-money laundering regulation.The administration mentions that decentralized trading platforms can be subjected to the nation’s AML (anti-money laundering) Act.
However, while making the report, the Council declared that its main aim is to develop the best framework regulations so that Swiss can evolve as an innovative, leading and sustainable region for blockchain and fintech firms.