CH - FINMA’s Stable Coin Guidelines


On 11 September 2019, the Swiss Financial Market Supervisory Authority (FINMA) published a supplement to their guidelines for Initial Coin Offerings (ICO).

This supplement provides guidance on “stable coins” under Swiss financial market regulation. Among others, it is a reaction to Libra, Facebook’s stable coin, which will be pegged to a currency basket. This coin will be issued by the Libra Association, a Swiss not-for-profit organization domiciled in Geneva. 

Since there is no specific regulation governing stable coins, FINMA once again affirms its functional approach (‘substance over form’) – where the economic function and purpose of a token defines the regulatory treatment – and follows the principle of ‘same risks, same rules’, while making its assessment on a case-by-case basis. FINMA elaborates that stable coins regularly fall within the scope of the Banking Act  or the Collective Investment Schemes Act . Furthermore, the Anti-Money Laundering Act  is largely applicable, since stable coins are often designed to serve as payment instruments. For payment systems with significant importance, a license under the Financial Market Infrastructure Act  might be required.

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