Switzerland is introducing legal reforms and licensing for blockchain trading to build a regulatory framework to regulate the untethered crypto economy.
Efforts to gentrify Bitcoin
Switzerland passed institutional and financial reforms in 2021 to lay a stable platform for a more gentrified and regulated cryptocurrency business. Two crypto banks, a crypto stock exchange and the country’s first crypto assets fund have all gained licenses to trade on the blockchain in the previous two years. The goal is to remove all uncertainty from the blockchain concept, making it more suited for reputable financial institutions.
Katie Richards, the former Head of Crypto at Falcon Pvt Bank, says that the country is always innovating to meet market demands and problems. She explained,
“The market has matured, the legal framework is there, licenses are being handed out, a pipeline of new financial products are being created.”
The Past and Future of cryptocurrency in Switzerland
With governments like China and the United States frowning on Bitcoin, Switzerland has been viewed as a haven for business. Switzerland has been in the game for a while, from non-profits chosen to hold assets from blockchain initiatives to military alpine bunkers repurposed to crypto storage facilities. As a result, the country is now attempting to bridge the gap between the opaque realm of blockchain and traditional businesses.
Regulations can be a boon rather than a curse
A regulatory framework is a boon to the business, which is still in its infancy. The certainty will provide a firm path for the business to follow, free of the regulatory snafus that have plagued the industry in the United States. Furthermore, knowing what is and is not permitted aids in the development of business models and revenue strategies, particularly when designing blockchain-compliant instruments such as company shares or NFT ownership rights.
According to Amir Taaki, the founder of the DarkFi decentralized project, Switzerland’s legislation is significantly more favorable than the anti-crypto laws now in place in the United States.
Even in a safe refuge, problems persist
Despite progress on the way to crypto-regulation, the financial industry continues to harbor reservations about the business. Most institutions are concerned about money laundering and illicit activities involving crypto funds. This is why they are hesitant to provide bitcoin start-ups with a bank account. On the other hand, increasing oversight is not recommended because it goes against the decentralization module that is at the heart of blockchain technology. As a result, many industry experts feel that to democratize operational management, the inflexible laws controlling banks and other financial institutions should be replaced with decentralized technology inspired by blockchain.