Swiss authorities have acknowledged that Blockchain and its underlying products have found due traction in the country. According to the country’s financial regulator, inquiries around Blockchain, cryptocurrencies, bitcoin, and initial coin offerings (ICOs) in Switzerland have shown tremendous growth last year.
In its annual report for the year 2017, the Swiss Financial Market Supervisory Authority (FINMA) said that, out of the total 453 fintech related enquiries, 60 percent (271 cases) were focused on ICO, cryptocurrency, smart contracts, and other Blockchain applications. Going by year-on-year analysis, this number marks nearly 300 growth as compared to 2016 when roughly 22 percent of the enquiries were related to ICO and Blockchain.
While there are a number of factors contributing to this growth (like, global trend, higher receptivity in EU, and phenomenal ROI), the Swiss regulator also bears the credit for the growth. The agency is working on the topic taking it as a key point in the supervisory work.
Though it has been very skeptical about the ICOs, suspending a few franchises last year, it did announce and updated regulatory guidelines for token sale – which ultimately fueled positive sentiments.
As a result of this regulatory support and positive sentiments, we have seen a stunning growth in the number of enquiries. FINMA report confirms that "In the second half of the year (2017), there was a sharp increase in enquiries about raising capital via ICOs."
Last month, FINMA updated its regulatory guidelines on how it will treat various tokens issued through ICOs, declaring some of the tokens as securities. To make things better for the investors and startups, the agency announced to examine tokens on a case-by-case basis, outlining three main categories. The agency's chief executive, Mark Branson, is confident that the updated guidelines will not only help the startups in raising capital but also protect the common man and investors from any kind of fraud.
However, he also outlined the growing challenges; particularly, cybersecurity amid growing hacking attacks on financial services, exchanges, and banking systems.
“The risks connected with these attacks are growing in sync with the pace of global digitalization. Cyber-attacks are now the most serious operational hazard facing the financial system, and both the private sector and public authorities should take them extremely seriously,” Mark told the news conference on the eve of annual report launch.
It is pertinent to note that being one of the world’s hottest financial markets, Switzerland has had some of the world's biggest ICOs (initial coin offerings). The famous cryptocurrency project Tezos, had raised $232 million (in July, 2017) through a Swiss-based foundation. However, owing to regulatory ambiguities, internal turmoil, and multiple lawsuits, the process slowed down.
Now, the regulator has announced that token-sales backed by Blockchain platform or representing underlying assets will be treated like securities (with some exceptions), there is a hope for uncertainty to end. Moreover, the fresh announcements and report will fuel positivity and also help in resolution of the legal challenges at hand.
At InWage, we are committed to help our clients envision, plan, and execute their token-sale in a seamless and profitable manner. Our team has deep expertise in making your ICO a big hit, and we have done it many times, in world’s most competitive markets. Get in touch, if you wish to learn more!