The Swiss Financial Market Supervisory Authority (FINMA) has published new guidance on the issuance of stablecoins on Friday, addressing default guarantees, associated risks, and its practices regarding stablecoins. The guidance also highlights the heightened risks related to <a href="https://www.unlock-bc.com/104122/swiss-prosecutors-freeze-26-million-in-crypto-belonging-to-terraform-labs-and-executives-sygnum-implicated/" class="ek-link" rel="noopener noreferrer nofollow">money laundering </a>in this area.
In recent years, stablecoin projects have gained prominence in Switzerland, aiming to offer low-volatility payment options on blockchain. FINMA previously commented on these projects in its September 2019 supplement to the ICO guidelines, which addressed regulatory inquiries about initial coin offerings (ICOs).
The new guidance outlines financial market laws applicable to stablecoin projects and their impact on supervised institutions. It also underscores the increased risks of money laundering, terrorist financing, and sanctions circumvention associated with stablecoins, posing reputational risks to the Swiss financial sector.
FINMA notes that many stablecoin issuers in Switzerland use default guarantees from banks, often bypassing the need for a FINMA banking license. This arrangement, however, presents risks for both stablecoin holders and the banks providing these guarantees. FINMA details its minimum requirements for default guarantees to protect depositors, emphasizing that these standards also apply to stablecoin transactions.
The post <a href="https://www.unlock-bc.com/126298/swiss-regulator-finma-issues-new-guidance-on-stablecoins-highlights-key-risks/" rel="noopener noreferrer nofollow">Swiss Regulator FINMA Issues New Guidance on Stablecoins, Highlights Key Risks</a> appeared first on <a href="https://www.unlock-bc.com" rel="noopener noreferrer nofollow">UNLOCK Blockchain</a>.

Swiss Regulator FINMA Issues New Guidance on Stablecoins, Highlights Key Risks

UNLOCK_ENG

Other articles published on Jul 27, 2024

Ex-FTX exec asks for delay reporting to prison after dog attack

Is Bitcoin Still the Most Commonly Exploited Cryptocurrency by Criminals?

Bancolombia’s Chainlink Integration Paves the Way for Industry-wide Adoption

Senator Cynthia Lummis Unveils Major Pro-Bitcoin Bill At BTC Conference

Trump’s Historic Bitcoin Speech is Almost Here – Here is the Expected Time and Latest Details

Peter Schiff Criticises Robert Kennedy’s BTC Buy Plan If Elected The President

Join our free newsletter for daily crypto updates!