FINMA will oblige to pass KYC verification for operations with crypto assets by more than $ 1,000

Switzerland is tightening cryptocurrency regulation. Thus, users of digital currencies will be required to go throughidentification during operations with crypto assets worth more than $ 1,000.

Switzerland renowned for its friendly attitude towardsnew technologies, which attracts hundreds of cryptocurrency companies to the country, are expanding their financial regulatory framework. Some rules imply increased supervision of cryptocurrency and blockchain companies in accordance with new international standards regarding operations with digital assets.

Swiss Financial Market Supervisory Authority(FINMA) proposed lowering the minimum amount for operations with crypto assets that require customer identification. The regulator wants to reduce the limit from 5,000 Swiss francs to 1,000 francs (a little over $ 1,000). FINMA states that it “recognizes the increased risks of money laundering in this area” and that the measure may not appeal to many cryptocurrency companies and their customers for whom privacy is important.

The amendments were the result of the new SwissThe Financial Services Act and the Financial Institutions Act. Both bills were passed by the Swiss parliament in June 2018. At a meeting in November 2019, the Swiss Federal Council proposed improving legislation on distributed ledger technology (DLT) to clearly define the legal status of technologies and remove barriers to their use.

These laws oblige FINMA to adopt variousprovisions that will be “mostly technical in nature”. The regulator has already developed a new Decree on financial institutions, which “regulates the details of professional liability risk insurance for portfolio managers, trustees and collective asset managers, details of calculating the minimum threshold for obtaining authorization as a portfolio manager, as well as on risk management and internal management”.

The Swiss financial regulator has also prepared amendments to other regulations and circulars. Changes will be submitted for public comment in the next few months.

Identification Threshold Changescryptocurrency users are also associated with the recommendations of the International Financial Action Task Force on Money Laundering (FATF). In accordance with the recommendations of the intergovernmental organization, cryptocurrency companies (exchanges, purse providers and payment operators) should identify customers who transfer crypto assets worth more than $ 1,000 or € 1,000.

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