Unique Regulation Systems for VASPs in Switzerland

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Switzerland has a unique regulatory system for the para-banking sector, which includes licensing opportunities for cryptocurrency companies (VASPs, or Virtual Asset Service Providers) engaged in cryptocurrency exchange, payment processing, crypto-asset backed plastic cards, and other financial services. This licensing system operates under the framework of Self-Regulatory Organizations (SROs), which are regulated and supervised by the Swiss Financial Market Supervisory Authority (FINMA). Companies that gain membership in an SRO can engage in para-banking activities, covering a wide range of financial operations while remaining under strict regulatory oversight.

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The uniqueness of the SRO concept lies in its ability to effectively replace payment licenses required in the UK or EU, making them comparatively more accessible for companies meeting proposed requirements. The SRO model makes Switzerland an attractive destination for companies operating in cryptocurrency and para-banking services, providing an efficient and flexible mechanism to enter the market.

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Main requirements for SRO membership:

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1. Compliance with AML legislation and establishment of internal controls
2. Positive reputation of team members
3. Economic presence (substance) in Switzerland

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It is important to note that companies starting operations in Switzerland and classified as financial intermediaries must join an SRO. According to the Anti-Money Laundering Act (AMLA), financial intermediaries are entities that professionally accept, hold, invest, or transfer assets belonging to others. Ensuring compliance with licensing requirements? Each SRO member undergoes an annual audit to assess financial health, AML compliance, including client onboarding, monitoring, and reporting. Team members involved in compliance function must complete SRO annual training. Specific rules vary by each SRO but align with Swiss AML regulation.

Which SRO to apply?

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As of early 2025, 11 SROs are recognized in Switzerland by FINMA. The choice of an SRO depends on company needs, language preferences, and specialization. While some SROs operate in German (Zug) or Italian (Ticino), many now offer English communication and training for crypto businesses. Membership approval typically takes 1 to 4 months, longer for complex or foreign structures.

Comparison with Other Licenses

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Many companies entering Switzerland often misjudge the nature of their activities and aim for more complex licenses directly supervised by FINMA. For example, the Fintech License, which allows the issuance of IBANs and effectively enables operations as a “light version of a bank,” requires compliance with the Swiss Banking Act. This involves capital requirements starting at 300,000 CHF and intricate regulatory conditions.

However, for intermediary activities, regulation through an SRO is often sufficient. For instance, if you handle payments, joining as a member of SRO enables you to operate with client funds, provided such funds are held in client accounts for no more than 60 days. Beyond this period, the operation is classified as a deposit, and the funds must be withdrawn in advance. SRO membership permits this if you have the technical capabilities to monitor transfers and manage fund storage within the specified timeframe.

Advantages of the SRO Model

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The SRO license has a low entry threshold. To obtain it, companies must present a business plan, but significant nominal capital is not required. This allows businesses to quickly commence operations, build a client base, and scale their activities within the first year. 

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For companies planning more ambitious ventures, the SRO model provides an opportunity to refine internal processes, test business models, and establish control systems before transitioning to more complex licenses, such as Fintech or Banking Licenses, which can be pursued simultaneously.

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The Swiss SRO model is an efficient starting point for companies operating in cryptocurrencies and para-banking services. It offers a balance of flexibility, regulatory compliance, and control, enabling businesses to launch operations swiftly while laying a strong foundation for future growth.

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