Stablecoin’s present-day prospects and challenges in monitoring blockchain and crypto were discussed and were informed to the Swiss Federal Council in a meeting.
Switzerland is usually susceptible to all sorts of methodologies that could be applicable to the financial market but will also observe and scrutinize neoteric technologies such as blockchain.
Per federal council observation, the Libra cryptocurrency, which Geneva-based Libra association, is supported by various other cryptocurrencies, which means that the chances of it being unstable are least likely.
During September, Libra association contacted the Swiss Financial Market Supervisory Authority (FINMA) requesting an evaluation regarding the matter of “stable coin” issuance by the Libra project. They required a statement on the stance of this issuance in the eyes of the Swiss supervisory law.
FINMA monitoring blockchain activity
As per FINMA’s answer, a project like this would be in the category of financial market infra regulation. FINMA would have to grant the project a license for its payment system in accordance with the Financial Market Infrastructure Act (FMIA).
The Principles of Financial Market Infrastructure (PMFI) comprise regulatory necessities, which are crucial for payment systems in Switzerland. Similar requirements exist for cyber jeopardies and risks. The Swiss-system is directly linked to the Anti-Money Laundering Act committees
Regulatory requirements for payment systems in Switzerland are based on the prevailing international standards, particularly the Principles for Financial Market Infrastructures (PFMI). These requirements also apply to the management of cyber risks. Also, a Swiss payment system is automatically subject to the Anti-Money Laundering Act.
Concurring what the Federal Council had to say, they keep a close eye on the blockchain and stablecoin projects around the world and know the calculated risks and opportunities seen by them. They know the drawbacks faced due to fighting against money laundering and terrorist financing. The policy is steadfast, especially one used by the government, banks, and authorities during transactions in particular.
The highly anticipated annual meetings of Bretton Wood institute and the meeting of G20 finance minister with the central bank governments may be the perfect place for discussing these new technologies and their implementation.