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On August 20, 2019, the Swiss Banking Association (“SBA”) released guidelines for member banks (in German with Italian, French and English versions to follow) about opening company accounts for companies with a nexus to distributed ledger technology (“DLT”).  These guidelines update the SBA’s guidelines from  September 21, 2018. The guidelines outline what banks should require of DLT-nexus companies in the account opening process to address risk management related to issues such as anti-money laundering (“AML”).…

During a speech at Consenus 2019, Sigal Mandelker, the U.S. Treasury’s Under Secretary for Terrorism and Financial Intelligence, reiterated the projection that the Financial Action Task Force (“FATF”) will adopt international standards for cryptocurrency-based services in June 2019.  FATF (also known by its French name, Groupe d’action financière) is an independent inter-governmental body that develops global standards for anti-money laundering and counter-terrorist financing. In 2014 and 2015 FATF began expressing concerns that the potential benefits…

The trend of established banks partnering with technology companies to offer digital asset-related services continues in Switzerland.  Around the end of February 2019, Julius Baer, one of Switzerland’s largest and oldest banks, announced plans to offer access to digital assets through a partnership with SEBA Crypto, a Swiss-based start-up. This development follows similar arrangements between technology companies and other established banks such as Falcon Private Bank, Vontobel, and Gazprombank. This trend underscores Switzerland’s reputation as…

On November 30, 2018, the Federal Council (the highest executive authority of Switzerland) published the implementing rules governing the newly introduced Swiss “innovator license.”  The Swiss Parliament has recently enacted this new license category. Younger companies, in particular from the fintech and blockchain space, often engage in taking deposits from the public. Until recently, this activity was reserved for banks. However, fintechs that operate payment systems, including such systems based on cryptocurrencies or other blockchain…

Up to now, the Swiss Financial Market Supervisory Authority (FINMA) has taken no official position on how to consider cryptoassets for the Basel III capital requirements or liquidity ratios for banks and securities dealers. According to current media reports, however, FINMA is said to have revealed its practice on the issue in a confidential letter sent to EXPERTsuisse, an association representing Swiss trustees and accountants, on October 15, 2018. The following is a summary of…

Crypto Fund AG, a subsidiary of Swiss-based Crypto Finance AG, received authorization from the Swiss Financial Markets Supervisory Authority (FINMA) to act as an Asset Manager defined under the Swiss Collective Investment Schemes Act (CISA). The Press Release from Crypto Finance AG states that Crypto Fund AG, now being an authorized Asset Manager, is permitted to “manage and distribute domestic and foreign investment funds to qualified investors and provide investment advice for institution clients.” This…

During 2017, the issue that probably got the most attention for companies raising capital through initial coin offerings (ICOs) was whether tokens constitute securities.  However, governmental agencies and regulators, particularly the Swiss Financial Market Supervisory Authority (“FINMA”), focused on other legal issues as well. It was reiterated that companies issuing cryptocurrencies or tokens have to consider not only securities registration but also anti-money laundering and licensing compliance. It has also become clear that blockchain-related businesses…

Switzerland often ranks among the most friendly and accommodating countries for blockchain-based companies to conduct their initial coin or token offering (“ICO”). Indeed, recent estimates are that more than 530 blockchain companies established in the Swiss cantons of Zurich and Zug have raised more than US$540 million through ICOs. Despite these facts, these companies often face significant difficulties in opening a bank account in Switzerland to hold the fiat currency proceeds of their ICOs. Swiss…