Regulatory Update: New Rules on Payment Tokens and Two New Categories of Financial Institutions
On 22 October 2025 the Swiss Federal Council launched a public consultation on proposed amendments to the Swiss Financial Institutions Act (FINIA). This revision aims to align the current legal framework with the dynamic international developments in fintech and cryptocurrencies. The Federal Council proposes introducing two new categories of financial institutions under FINIA:
- Payment Institutions, replacing the existing “fintech licence” under the Swiss Banking Act (BankA); and
- Crypto Institutions, authorised to provide custody, trading and other services relating to crypto-based assets with trading characteristic.
In addition, Payment Institutions are given the exclusive authority to issue value-stable crypto-based means of payment.
Below is a summary of the key elements of the proposed FINIA amendments and related adjustments to the Swiss Financial Services Act (FINSA) and Anti-Money Laundering Act (AMLA).
With this revision, the legislator aims to create a clearer and more consistent framework for innovative financial technologies and to define more precise requirements for supervision and anti-money laundering prevention within this framework. The consultation period runs until February 2026 (see further information here).
New categorisation of payment tokens
In general, crypto-based assets are digital assets, usually recorded on a blockchain, where control is exercised exclusively via a crypto-based access procedure. A sub-category of these crypto-based assets are payment tokens, which are used as a means of transferring money and value. This category includes, in particular, well known cryptocurrencies such as Bitcoin or Ether.
However, services related to cryptocurrencies or payment tokens have been largely unregulated in Switzerland to date. This includes trading on behalf of clients, portfolio management, or providing personal recommendations related to cryptocurrency transactions. Depending on specific conditions, custody services for payment tokens may currently require a fintech or banking licence.
Stablecoins are also a type of payment token. They represent a claim against the issuer linked to an underlying asset, typically a FIAT currency. When pegged to a specific FIAT currency with a fixed redemption value, FINMA considers this akin to a public deposit, meaning the issuer requires a banking or fintech licence to issue stablecoins or to accept client funds related thereto, respectively.
Going forward, the revised regulation will distinguish two categories of payment tokens:
- Value-stable crypto-based means of payment (for ease of reading, referenced in here as “Regulated Stablecoins”); and
- Crypto-Based Assets with Trading Characteristics. This category includes classic cryptocurrencies but also crypto-based assets that are not utility tokens, that do not qualify as financial instruments, and that do not represent banking deposits (so-called “deposit tokens”).
Services related to these payment tokens will be subject to stricter regulation. Other token categories (utility and investment tokens) remain unaffected by the proposed amendments.
Regulated Stablecoins
According to the Federal Council’s proposal, Regulated Stablecoins are crypto-based assets issued exclusively in Switzerland, linked to the value of a state-issued currency (FIAT currency), and granting the holder a claim for redemption at nominal value.
Issuance of Regulated Stablecoins will be exclusively reserved for Payment Institutions. While banks may continue to accept public deposits and provide payment services, they will not be permitted to issue Regulated Stablecoins directly. Instead, they must establish a separate legal entity that obtains a licence as Payment Institution to issue such stablecoins. FINMA will maintain a list of Regulated Stablecoins.
Issuing a Regulated Stablecoin will also require the publication of a white paper, akin to the prospectus required for public offerings of financial instruments. This document is intended to provide potential purchasers with the information necessary to understand the key characteristics and risks of the Regulated Stablecoins, aligning Swiss regulation with international practice.
The Federal Council does not propose prudential regulation of secondary market trading of Regulated Stablecoins, as these stablecoins will be treated as a means of payment (see below regarding AML adjustments).
Crypto-Based Assets with Trading Characteristics
This category covers traditional cryptocurrencies such as Bitcoin and Ether, as well as certain stablecoins that do not meet the regulatory criteria for Regulated Stablecoins (considered Crypto-Based Assets with Trading Characteristics).
Examples include foreign-issued stablecoins pegged to FIAT currencies or basket-linked stablecoins with value-dependent development. Depending on their structure, some of these instruments may qualify as collective investment schemes and thus as financial instruments.
A public offering of Crypto-Based Assets with Trading Characteristics or admission of such assets to trading on a distributed ledger technology (DLT) trading system will also require the publication of a white paper describing the characteristics and risks of the asset.
New category of financial institutions
Current fintech licence
The current fintech licence according to Article 1b BankA allows non-bank companies to accept public deposits up to CHF 100 million. These funds may not bear interest or be used for lending (prohibition of active banking business). Consequently, their business models are typically limited to payment services.
Although fintech institutions benefit from certain reliefs – particularly regarding minimum capital, own funds, liquidity, accounting, and auditing – they are generally subject to the same requirements as banks. However, public deposits with these companies are not covered by deposit insurance under BankA and are not segregated from bankruptcy estate.
In the bankruptcy of a custodian holding crypto-based assets in collective custody, these assets may be segregated from bankruptcy assets. Assets segregated in bankruptcy do not qualify as public deposits under BankA, so custody of crypto-based assets for clients does not require a banking licence. This was deemed inappropriate, so the fintech licence requirement was extended to cases where collective custody for payment tokens on behalf of clients was offered.
New category: Payment Institutions
The Federal Council aims to further develop the original idea of today’s fintech licence to make it more attractive and better suited to underlying business models. The fintech licence provisions will be removed from BankA and incorporated into FINIA by creating the new category of Payment Institutions.
Accordingly, companies that intend to publicly accept client deposits (Kundengelder) commercially without a banking licence will need to apply for a Payment Institution licence under FINIA. Activities of Payment Institutions will be limited to accept client deposits, issuing Regulated Stablecoins at the nominal value of the client deposits, providing custody services for Regulated Stablecoins and providing payment services. Client deposits must not bear interest, and the Payment Institution must invest these assets only in accordance with strict regulatory restrictions.
To improve client protection, client deposits must be held either as sight deposits with a bank or another Payment Institution or invested in high-quality liquid assets with short maturities (details shall be defined by the Federal Council). These client deposits and assets must be segregated from the institution’s own funds as separate assets and may not be used for the institution’s own purposes.
In bankruptcy these segregated assets are automatically excluded from the bankruptcy estate. Clients will not have a direct claim on the assets; rather, the assets will be liquidated in bankruptcy and proceeds distributed to clients. This bankruptcy privilege applies only between clients and the payment institution; the institution does not have bankruptcy privilege over funds it holds with third-party custodians.
Because of the segregation of assets in bankruptcy, these client depots differ from public deposits according to BankA. This separate treatment requires a distinct regulatory framework for Payment Institutions outside the BankA, which makes the current CHF 100 million limit on public deposits or client deposits obsolete.
Payment Institutions may also issue Regulated Stablecoins. If a Payment Institution issues multiple Regulated Stablecoins, it must segregate client funds received for each stablecoin as separate assets. Issuing a new Regulated Stablecoin by the same Payment Institution requires a FINMA approval to amend the existing licence. Custody of Regulated Stablecoins for clients is a permitted service subject to the same conditions that apply to custody services of Crypto Institutions.
New category: Crypto Institutions
Currently, most activities involving Crypto-Based Assets with Trading Characteristics are generally not subject to prudential licensing under existing law. In particular, trading cryptocurrencies and operating such trading platforms are permitted without a licence, as is the individual custody of assets for clients.
The Federal Council intends to change this legal arrangement by subjecting the trading of Crypto-Based Assets with Trading Characteristics to prudential supervision. To this end it proposes the creation of a new licensing category for Crypto Institutions. The licensing requirements will be tailored to the specificities of crypto trading and will largely follow the corresponding regulations applicable to securities dealers engaged in securities trading.
The new licensing obligation will specifically cover custody activities (including the provision of custodial staking services) and client trading of Crypto-Based Assets with Trading Characteristics. Crypto Institutions will also be allowed to hold Regulated Stablecoins in custody for clients. Furthermore, a Crypto Institution will be allowed to operate an organised trading system, provided that this system exclusively permits trading in Crypto-Based Assets with Trading Characteristics.
Crypto Institutions must segregate the Crypto-Based Assets with Trading Characteristics (and Regulated Stablecoins) held for clients from their own funds and keep them readily available for clients at all times. They must also allocate these assets either individually or collectively to clients, with clear identification of each client’s share in the collective assets. These requirements correspond to the conditions set out in Article 242a of the Swiss Debt Enforcement and Bankruptcy Act (SchKG) and thus permit segregation of assets from the bankruptcy estate in insolvency proceedings.
The licensing requirement does not extend to proprietary trading, analogous to the regulation of securities trading. Discretionary portfolio management of Crypto-Based Assets with Trading Characteristics is also not reserved exclusively for licensed Crypto Institutions. Hence, asset management and investment advice remain subject to prudential licensing only if they relate to financial instruments, consistent with the current legal situation in Switzerland. However, the provision of certain client services related to Crypto-Based Assets with Trading Characteristics will in future be subject to conduct rules under FINSA, and providers must comply with organisational duties under FINSA.
Regarding the licensing hierarchy under FINIA, banks and securities dealers will not require an additional licence as Crypto Institutions. Nevertheless, these institutions must comply with the legal requirements applicable to Crypto Institutions. If an existing bank wishes to offer services that fall under the Crypto Institution licensing obligation, this constitutes a change in the bank’s business activities and therefore requires prior (amendment) approval from FINMA. Conversely, a licence as a Crypto Institution does not entitle the institution to provide additional services; in particular, a Crypto Institution may not offer asset management services relating to financial instruments or collective investment schemes (and vice versa).
Anti-money laundering
The provision of custody, exchange, trading, and payment services involving payment tokens is already subject to the AMLA. However, service providers in this area who qualify as financial intermediaries under anti-money laundering law are often not prudentially supervised by FINMA. Accordingly, these financial intermediaries must currently affiliate with a self-regulatory organisation (SRO).
Going forward, Payment Institutions and Crypto Institutions will be subject to FINMA supervision. This change will also transfer anti-money laundering supervision of these institutions from the SROs to FINMA.
In connection with the issuance of Regulated Stablecoins, Payment Institutions will be subject to anti-money laundering obligations. These include customer identification, diligent transaction monitoring, and compliance with the so-called “Travel Rule” (transmission of sender and recipient data for transactions). Payment Institutions must conduct a risk assessment prior to issuance and implement the necessary measures for risk management and risk reduction. This includes monitoring and limiting risks on the secondary market. Monitoring must be conducted globally, as territorial considerations generally do not restrict blockchain transactions.
The organisational measures to be implemented include either maintaining a blacklist of wallets from or to which transactions involving Regulated Stablecoins are prohibited, or ensuring that all token holders are identified either by the institution itself or by equivalently supervised financial intermediaries.
The code of the Regulated Stablecoin must be designed so that the Payment Institution, as issuer, can at any time block transactions, freeze Regulated Stablecoins on a wallet address, and reclaim them even against the will of the holder. This also ensures that issuers are technically capable of complying with orders from competent (criminal) authorities. These additional measures enhance transparency and security in the handling of Regulated Stablecoins and contribute to compliance with anti-money laundering standards.
