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ICO News: Cryptocurrency Exchange Gets Green Light in Crypto Valley

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Switzerland's Financial Market Supervisory Authority (FINMA) has issued its maiden license for a cryptocurrency exchange to operate as a  Directly Subordinated Financial Intermediary (DSFI). Payment21 has been awarded a license after about a year of preparation and investment with the regulator. As a regulated exchange, Payment21 has proven itself to be compliant with anti-money laundering (AML) and know-your-customer (KYC) protocols, all of which support upcoming ICOs. 

Bernhard Kaufmann, managing director at Payment21 parent company Moving Media GmbH, said: "Our handling of compliance issues enriches the digital currency ecosystem and demonstrates that Swiss regulators embrace competitiveness in financial services and truly encourage fintech innovation in the digital era." 

The fact that Payment21 is the first cryptocurrency exchange to receive the DSFI license is notable given the high-profile nature of Switzerland for cryptocurrencies. The small town of Zug, otherwise known as Crypto Valley, has taken a leadership position for both the blockchain and upcoming ICOs. One of those ICOs was Tezos, which is currently in the midst of a battle for control of the foundation tied to the blockchain startup.

Swiss Regulatory Crackdown  

FINMA has observed an uptick in the number of local upcoming ICOs, which largely remain unregulated. The step forward for cryptocurrency trading and upcoming ICOs comes on the heels of a recent move by the Swiss regulator to warn that upcoming ICOs could breach the rules surrounding funding terrorism. 

FINMA revealed it is investigating certain upcoming ICOs "to determine whether certain regulatory provisions have been breached," according to a statement. Chief among the concerns are money laundering and terrorist financing. The development came on the heels of another crackdown by the FINMA in recent weeks. They put the kibosh on what the regulator dubbed a "fake" cryptocurrency E-coin.

The company, which was a platform for trading the E-Coin, had taken millions of Swiss francs in public deposits from hundreds of participants before receiving the proper regulatory licenses, which is illegal. Regulators have since begun the liquidatation process of assets of both Ecoin and related parties. 

ICOs have thus far raised USD 3.2 billion across some 200 deals, according to Coin Schedule data. Switzerland has become an increasingly popular domicile for issuers in light of the ICO bans put in places such as China and South Korea. 

 

 

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