FINMA ICO Guidelines

The Swiss Financial Market Supervisory Authority (FINMA) released guidelines on how it intends to treat inquiries from ICO (initial coin offering) organizers and its categorization of offerings (which may qualify as a security and be classified as securities) into three distinct but not mutually exclusive types - payment, utility and asset tokens.

  • Payment tokens: Payment tokens (synonymous with cryptocurrencies) are tokens which are intended to be used, now or in the future, as a means of payment for acquiring goods or services or as a means of money or value transfer. Cryptocurrencies give rise to no claims on their issuer.
  • Utility tokens: Utility tokens are tokens which are intended to provide access digitally to an application or service by means of a blockchain-based infrastructure.
  • Asset tokens: Asset tokens represent assets such as a debt or equity claim on the issuer. Asset tokens promise, for example, a share in future company earnings or future capital flows. In terms of their economic function, therefore, these tokens are analogous to equities, bonds or derivatives. Tokens which enable physical assets to be traded on the blockchain also fall into this category.

Cases will be decided individually on their own unique facts and FINMA will scrutinize the essention 'economic function and purpose of the tokens (i.e. the blockchain-based units)' which are issued using key factors which comprise the 'underlying purpose of the tokens and whether they are already tradeable or transferable.' The bulk of the guidance is broken down into the following sections:

Principles applied when assessing specific enquiries

  • Token categories
  • Classification of tokens as securities
  • Legal implications of treatment as a security
  • Classification as deposits
  • Applicability of the Collective Investment Schemes Act
  • Applicability of the Anti-Money Laundering Act
  • Compliance with AMLA 

Document Details

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Year of Document: 
2018
Date of Document: 
Friday, February 16, 2018

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