Cryptoassets for investment and financing

Regulatory threshold

What attributes do the regulators consider in determining whether a cryptoasset is subject to regulation under the laws in your jurisdiction?

According to the Financial Market Supervisory Authority (FINMA), the applicable regulation depends on the types of cryptoassets. In its ICO-Guidelines, FINMA differentiates between:

  • payment tokens: synonymous with cryptocurrencies are tokens intended to be used, now or in the future, as a means of payment for acquiring goods or services or as a means of money, value storage or transfer. Cryptocurrencies give rise to no claims on their issuer. Payment tokens do not qualify as securities. However, collecting or transferring these cryptoassets will usually be subject to the Anti-Money Laundering Act (AMLA);
  • utility tokens: intended to provide access (digitally) to application or services through a blockchain-based infrastructure. If a utility token functions solely or partially as an investment in economic terms, FINMA will treat them as securities (ie, in the same way as asset tokens); and
  • asset tokens: represent assets such as a debt or equity claim against or in the issuer. Asset tokens promise, for example, a share in future earnings or future capital flows of the issuing entity or the platform. In terms of their economic function, these tokens are treated analogously to equities, bonds or derivatives (securities). Generally, tokens that enable physical assets to be traded on the blockchain also fall into this category. FINMA regards asset tokens as securities, meaning that there are securities law requirements (the Financial Services Act (FinSA), the Financial Market Infrastructure Act and FinIA) for trading in them, and civil law requirements under the Swiss Code of Obligations.


The individual token classifications are not mutually exclusive (eg, both asset and utility tokens can be classified as payment tokens (hybrid tokens)).

Depending on the type of cryptoasset, different laws may apply.

The new Digital Ledger Technologies (DLT) Bill will define the term cryptoassets regarding the applicability of the Banking Act (BA) and thus the need for a banking licence.

Accordingly, cryptoassets are crypto-based assets, which are collectively pooled and are no longer individually assignable to an individual client. These cryptoassets must intend to serve as a means of payment for the purchase of goods or services or the transfer of money or value.

Cryptoassets are not considered crypto-based assets in the sense of the BA, if they are booked as credit balances on the customer accounts of securities or precious metal dealers, asset managers, a DLT trading facility or similar companies and serve solely to process customer transactions, if:

  • no interest is paid for it; and
  • in the case of accounts other than those of securities dealers, settlement shall take place within 60 days.
Investor classification

How are investors in cryptoassets classified and treated differently?

According to FinSA, there are three main types of investor connected with financial services:

  • institutional clients, such as banks and securities houses;
  • professional clients, such as financial professionals; and
  • retail clients, which essentially fall outside the previous two categories and refer to consumers.


High net worth individuals may declare to be treated as professional clients for investment purposes.

Initial coin offerings

What rules and restrictions govern the conduct of, and investment in, initial coin offerings (ICOs)?

There is no uniform law governing ICOs in Switzerland. Depending on the qualification of the cryptoasset, different provision may apply. There is no FINMA authorisation requirement for conducting an ICO, unless a cryptoasset is deemed as being derivative or if there is a repayment obligation of the issuer. In these cases, authorisation as a securities house or a banking licence may be necessary. The banking licence is the highest regulated category of financial market participation.

An ICO of a payment token triggers obligations under AMLA. However, payment tokens qualify as securities as long as they are not operational on a blockchain.

An ICO of a utility token is not subject to AMLA if the functionality of the token pertains to access to the blockchain for mainly non-financial purposes. If a utility token functions solely or partially as an investment in economic terms, FINMA will treat them as securities.

An ICO of an asset token may, according to FinSA, lead to the obligatory publication of a prospectus or information sheet.


Generally, in Switzerland, four stages in an ICO can be distinguished:

  • the pre-financing stage: investors are only offered the prospect that they will receive tokens at some point in the future and the tokens or the underlying blockchain, or both, remain to be developed. There are no transferable tokens on a blockchain at this stage.
  • the pre-sale (voucher) stage: investors receive tokens entitling them to acquire or receive different tokens at a later stage (conversion or exchange is required).
  • the pre-operational stage: the tokens’ main functionality is ready but it cannot be used yet at the point of issuance because the application, platform or underlying blockchain remains to be developed or requires completion. No token conversion is necessary once the development of the platform or underlying blockchain is completed.
  • the operational stage: the tokens’ main functionalities are ready and can be used in the intended way on a functional blockchain, application or platform at the point of issuance.
Security token offerings

What rules and restrictions govern the conduct of, and investment in, security token offerings (STOs)?

Offering cryptoassets qualifying as securities only leads to an authorisation requirement, if the cryptoassets in question are derivatives, collective investment schemes or if an intermediary places the securities on behalf of the issuer in the primary market (securities-house licence).

Regarding a public offering, issuers of securities must, according to FinSA, publish a prospectus to be reviewed and approved by a reviewing body authorised by FINMA. Exceptions to this rule are specified in the FinSA and include:

  • offerings to professional investors;
  • offerings to less than 500 investors;
  • offerings to investors who invest more than 100,000 Swiss francs;
  • offerings of securities with a minimum denomination of 100,000 Swiss francs; and
  • offerings that are limited to a total amount of 8 million Swiss francs.


Further, if securities are offered to retail investors, the issuer is generally required to draft a basic information document.


What rules and restrictions govern the issue of, and investment in, stablecoins?

For stablecoins, FINMA follows the rules based on the stablecoin supplement to the ICO-Guidelines, which takes the same approach as blockchain-based tokens by mainly focussing on the economic function and the purpose of a token (‘substance over form’). Depending on the case, FINMA will follow the ‘same risks, same rules’ principle and the relevant features of each case.

Since stablecoins can be variable, the requirements under supervisory law may differ depending on which assets (eg, currencies, commodities, securities and real estate) the stablecoin is backed by or pegged to and the legal rights of its holders. Regulations of banking, fund management, financial infrastructure, money laundering and securities trading can all become relevant.


Are cryptoassets distributed by airdrop treated differently than other types of offering mechanisms?

Generally no, but in certain cases, anti-money laundering provisions may apply. If the airdrop is done without required activity from the receiving party, the receiving party has not made an investment decision; therefore, there is generally no prospectus requirement.

Advertising and marketing

What laws and regulations govern the advertising and marketing of cryptoassets used for investment and financing?

Cryptoassets used for investment or financing usually qualify as securities, triggering FinSA prospectus and basic information sheet requirements with the issuer and FInSA duties of conduct at the point of sale with the financial services provider. In particular, advertising for financial instruments must be clearly recognisable as such. The advertising must refer to the prospectus and the basic information sheet for the respective financial instrument.

In all other cases, there are no strict provisions regarding advertising. However, laws regarding unfair competition and criminal statues concerning fraud must be observed.

Trading restrictions

Are investors in an ICO/STO/stablecoin subject to any restrictions on their trading after the initial offering?

Generally no, except, for example, potential transfer restrictions imposed by the issuer based on securities laws or derivatives trading obligations.


How are crowdfunding and cryptoasset offerings treated differently under the law?

According to Swiss regulations, four crowdfunding categories must be differentiated:

  • crowd donating;
  • supporting;
  • lending; and
  • investing.


Generally, only the debt-based crowdlending and the equity based crowd-investing platforms are currently subject to AMLA.

Crowdlending may lead to the requirement of a banking licence according to the BA. However, depending on the amount of funds raised, certain exemptions and reliefs may apply. In particular, the Fintech licence is available for innovative projects not collecting more than 100 million Swiss francs from the public and neither investing those funds nor paying interest. This licence provides for many reliefs regarding capital and organisational requirements. Depending on the structure, crowd investing may trigger collective investment-scheme regulations.

With the new DLT Bill, the threshold for the fintech licence will be amended so that the 100 million Swiss franc limit will not apply for cryptoassets regarding the BA, provided that they will not be invested and that no interest will be paid.

Transfer agents and share registrars

What laws and regulations govern cryptoasset transfer agents and share registrars?

No specific laws govern these services. Generally, AMLA must be observed for transferring any kind of cryptoasset qualifying as a financial instrument. In particular, changing cryptocurrency into another cryptocurrency or fiat currency is considered to be money exchange or remittance; therefore, is subject to AMLA. Also, the provision of cryptoasset transfer services will trigger anti-money laundering obligations, if the service provider conveys over the private key of its clients.

Anti-money laundering and know-your-customer compliance

What anti-money laundering (AML) and know-your-customer (KYC) requirements and guidelines apply to the offering of cryptoassets?

AMLA, and the corresponding ordinance, stipulate the obligations that must be performed by financial intermediaries subject to those laws.

Generally, only an ICO regarding payment token or a hybrid token with payment functions is subject to AMLA. However, AML and KYC requirements are often triggered if a financial intermediary is involved in a transaction with payment tokens.

Natural or legal persons offering services regarding cryptoassets within the scope of AMLA must join a self-regulatory organisation. Those private self-regulatory organisations recognised by FINMA will impose their own rules and supervision regarding AML compliance on their members.

Within the scope of AMLA, the following typical duties apply:

  • client identification;
  • verification of beneficial ownership;
  • politically exposed persons and sanctions checks;
  • source of funds and source of wealth;
  • enhanced due diligence in the case of high risks or red flag within the client relationship. In the context of the additional clarifications, further background information on the business relationship must be obtained. Depending on the circumstances, the origin, intended use or background of the assets contributed or deducted, the origin of the assets or the business activities of the customer or the beneficial owner must be clarified;
  • documentation duties;
  • notification duties; and
  • freezing of assets.


The extent of the aforementioned obligation may vary depending on the services or activities and the number of Swiss francs collected or transferred.

Presently, there are no specific rules, guidelines or established practices regarding cryptoasset providence identification or proof of ownership. However, these checks must be performed to comply with AMLA.

Sanctions and Financial Action Task Force compliance

What laws and regulations apply in the context of cryptoassets to enforce government sanctions, anti-terrorism financing principles, and Financial Action Task Force (FATF) standards?

The Federal Embargo Act (FEmbA) and the corresponding ordinances regarding specific sanctions towards certain countries, people or organisations to restrict the provision of certain services and sale of goods financing those persons. International United Nations sanctions are directly applicable in Switzerland and must be regularly observed, particularly when providing financial services. Business relationships with a sanctioned person may not be commenced or have been terminated respectively.

United Nations and the FATF anti-terrorism financing principles are implemented by FEmbA sanction’s legislation and AMLA, particularly the enhanced due diligence and notification duties, including the Travel Rule.

Law stated date

Correct on

Give the date on which the above content is accurate.

14 December 2021.