The Swiss parliament has passed a motion which allows the Federal Council to amend laws to allow for crypto regulations. In the March 20th press release, the motion was approved by a landslide. 99 to 83 votes were cast in favor of the amendment. Ten legislators did not take part in the voting process.
Giovanni Merlini, the Liberal public rep, sponsored the motion. He argued that the law would seal the loopholes in the current market. Therefore, it would protect investors against abuses.
According to the parliamentary paper,
…[Crypto] could be issued to anyone with a decentralized, cryptographic-based peer-to-peer data network. A large part of the cryptocurrencies is completely anonymous, which favored extortion and money laundering…
Critics Allude Vagueness
Although the motion sailed through the parliament, critics say that the proposal is unclear. For instance, people who are responsible for crypto trading platforms are not under an umbrella of any regulatory authority.
If anything, they should be treated as financial intermediaries. If that is the case, they would be under the wing of FINMA, the Swiss Financial Market watchdog.
Ueli Maurer, the finance minister, was a notable opponent. From the start, he was of the idea that the existing law should only be tweaked slightly. In his view, the market should be liberal. Liberal markets thrive.
Regulators, on the other hand, aim to rein in shady practitioners in the market. They issue regular warnings to investors to protect them against fraud. In early March, the French Financial Committee recommended a total ban on privacy coins.
The French Committee’s recommendation failed to take hold because it was also vague. It had been unable to define the different types of digital currencies. For this reason, it became a blanket ban, a notion that did not catch on with the rest of the house.
The Basel Recommendation
The Basel Committee also issued an international warning to banks around the world. It asked for vigilance against crypto businesses that engaged in risky practices.
Cryptocurrencies have been known to be an effective means of transmitting value across borders. Authorities have been keen to curb the powers of different operators to protect investors and the public in general.
Switzerland has been a favorable hub for the distributed ledger tech. The new rules will strengthen the existing monetary framework. They would also boost the nascent tech. It would protect people against money laundering, extortion, terrorism finance, and criminal fraud.
What do you think about the proposed crypto law? Will it help Switzerland keep its reputation as a favorable country for blockchain tech? Let us know in the comments section below!