The Swiss Financial Supervisory Authority (FINMA) announced that a number of new rules on the regulation of ICOs will take effect in the course of the past days. These rules will be integrated into the legislation of the current financial market.
FINMA CEO Mark Branson said that he saw these new rules as a way to ensure that blockchain technology could successfully enter the country market. He also added that the Branson blockchain companies could not escape regulatory systems.
The explanations made by Branson on this subject are as follows:
“The balanced approach we have taken to manage ICO projects and investigations allows legitimate entrepreneurs to comply with the regulatory system. So entrepreneurs can start their projects, the integrity of the financial system and the laws that protect investors in an appropriate manner. ”
According to a press statement by FINMA, one of the reasons for the implementation of these new rules is the increase in ICO numbers in Switzerland. In addition, we can say that the lack of clarity as to when or how ICOs should be regulated also increases the need for these rules.
In FINMA’s press release, it contains the following statements:
“The creation of transparency when considering dynamic market and high level demand is of great importance at this point.”
Moreover, FINMA has noticed that there is no specific regulation or “proper legal doctrine” for the administration of ICOs on the territory of the country.
In order to value ICOs to be regulated in the future and determine which laws will be enforced for their regulation, FINMA stated that the tokens presented at the ICO would be divided into three categories. These; payment tokens, usage tokens, and asset tokens.
Although this is the case in Switzerland, it is possible to say that organizing ICOs on a global basis is not an easy process. China’s ban on ICOs in the country in 2017 supports this. Countries like Singapore and Australia, on the other hand, do not leave Switzerland alone by designing ICO rules parallel to current legislation.
While the majority of ICO regimes are involved in this relatively new fund-raising method, the potential for fraudulent activity warns investors against potential. However, press release by FINMA draws attention to the risks posed by ICOs due to fluctuations in the market and the potential risks of unclear legal structure of contracts with blockchain technology.