A rapidly evolving technology requires an agile legal framework to create the conditions in which novel technologies can thrive whilst reducing the risk of abuse or fraud.
Legal Framework in Blockchain: Striking a balance
For Switzerland, it is crucial for the legal framework to enable rather than impede innovation so that the potential of new technologies can be fully realised. At the same time, Switzerland’s integrity and good reputation as a business location must be protected in this area.
In 2018, the Federal Council reported on the legal provisions around blockchain and DLT. The analysis showed that there was no need for fundamental adjustments to the Swiss legal framework or the introduction of a specific technology act, but did identify some specific amendments that could be made to a number of federal acts.
Blockchain Ecosystem: Keeping pace with change
In 2019, the Federal Council adopted the dispatch on legislation to adapt federal law to developments in distributed ledger technology. The proposal is aimed at increasing legal certainty, removing barriers for applications based on DLT and reducing the risk of abuse.
One of the key areas of the proposal is the amendment of securities law to provide a secure legal basis for the trading of rights through electronic registers. Additionally, the segregation of crypto-based assets in the event of bankruptcy is to be clarified by law.
Finally, it is planned to establish a new authorisation category for DLT trading systems in financial market infrastructure law, thereby creating a flexible legal framework for new forms of financial market infrastructure. These changes are expected to enter into force in 2021.
State Secretariat for international finance
Report on the legal framework for DLT and blockchain of 14 December 2018