On Friday Swiss financial regulator FINMA published guidance on Swiss stablecoins, highlighting the risks of stablecoins where the issuer has a bank guarantee. FINMA wants that reviewed when the Federal Council amends the Banking Act. Additionally, the report highlights that most Swiss stablecoins require the issuer to identify all stablecoin holders.
According to the latest report and a previous one from 2019, there are three main types of fiat currency stablecoins. In rare instances, they might be classified as a collective investment scheme, where the issuer manages the assets on behalf of the stablecoin holder. However, in most cases, the assets are held for the issuer’s account, thus categorizing them as a deposit under banking law.
The banking class of stablecoin can be issued by either a bank or a non bank. A non bank issuer must secure a bank guarantee to cover them in case of default, which must cover the total deposits and any customer earned interest. The stablecoin issuance can never exceed the guarantee limit.
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