Switzerland

**Report: Retail Cryptocurrency Trading Status in Switzerland**

**Date:** April 12, 2025

**Analyst:** Specialized Financial Regulatory Analyst AI

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**Topic: Retail_Trading_Status**

**Description:** Assessment of whether individual citizens and residents in Switzerland are legally permitted to buy, sell, and hold cryptocurrencies, detailing the regulatory environment surrounding this activity (e.g., KYC/AML requirements imposed on platforms, general warnings issued).

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**1. Current Status:**

`Allowed-Regulated`

**2. Narrative Explanation:**

Switzerland permits individual citizens and residents to buy, sell, and hold cryptocurrencies. While cryptocurrencies are not considered legal tender [2, 19, 20], they are legally recognized and treated as assets or property by Swiss authorities [4, 16, 20]. The country has established itself as a prominent hub for blockchain and crypto activities, often referred to as "Crypto Valley," fostering innovation within a defined regulatory framework [5, 12].

The regulatory landscape is overseen primarily by the Swiss Financial Market Supervisory Authority (FINMA) [4, 7, 9, 12, 21]. FINMA applies existing, technology-neutral financial market laws to crypto-related activities, following a principle-based and "substance over form" approach [3, 19, 21]. This means the specific regulations depend on the nature of the token (categorized by FINMA as payment, utility, or asset tokens, including hybrids) and the services offered [3, 9, 12, 22].

A cornerstone of the regulatory framework is the Anti-Money Laundering Act (AMLA) and its associated ordinances [3, 6, 7, 12, 21]. Entities acting as financial intermediaries, such as cryptocurrency exchanges, custodians, and certain wallet providers, fall under the scope of the AMLA [2, 4, 6, 7, 19]. These intermediaries must adhere to strict Know Your Customer (KYC) and Customer Due Diligence (CDD) requirements, including identity verification, clarification of the economic background of transactions, transaction monitoring, and record-keeping [3, 7, 12]. FINMA has specified thresholds, such as requiring identity verification for linked exchange transactions into cash or anonymous means exceeding CHF 1,000 within 30 days [7, 12]. Financial intermediaries must typically obtain a license from FINMA (e.g., banking, FinTech, securities firm, DLT trading facility license) or become members of a FINMA-supervised Self-Regulatory Organization (SRO) [3, 4, 6, 20, 22, 23].

Switzerland significantly enhanced legal certainty and facilitated innovation with the Federal Act on the Adaptation of Federal Law to Developments in Distributed Electronic Register Technology (the "DLT Act"), which came fully into force on August 1, 2021 [5, 10, 11, 13, 15]. This legislation achieved several key objectives:
*   It introduced "DLT securities" (or ledger-based securities) into the Swiss Code of Obligations, providing a solid legal basis for tokenizing rights and assets and transferring them directly on a blockchain [2, 10, 11, 13].
*   It created a new licensing category under the Financial Market Infrastructure Act (FMIA) for "DLT Trading Facilities." These platforms can offer trading, settlement, clearing, and custody of DLT securities, potentially providing direct access to retail clients, unlike traditional exchanges [2, 10, 15, 20, 24].
*   It clarified the segregation of crypto-based assets in bankruptcy proceedings, enhancing user protection when assets are held by custodians [5, 10, 11, 13].

Depending on the specific activities, other financial regulations like the Financial Services Act (FinSA) concerning rules of conduct, the Financial Institutions Act (FinIA) for licensing asset managers or securities firms, and the Banking Act (BA) for deposit-taking activities may apply [3, 6, 19, 21].

Regarding taxation, cryptocurrencies held by individuals as private wealth are treated as assets subject to the annual Wealth Tax. Capital gains realized from selling these assets are generally tax-exempt for private investors. However, income derived from activities like staking, lending, or mining, as well as gains realized by individuals classified as professional traders, are subject to Income Tax [4, 16, 24].

While fostering a crypto-friendly environment, FINMA also issues warnings regarding the risks associated with crypto assets, including high price volatility, cyber security threats, and the potential for money laundering and illicit activities [9, 14]. The regulatory approach aims to balance innovation with the integrity and stability of the Swiss financial center [5, 21].

In summary, retail cryptocurrency trading is legal and actively practiced in Switzerland, supported by a comprehensive and evolving regulatory framework that mandates licensing, AML/KYC compliance for intermediaries, and applies established financial laws, significantly shaped by the recent DLT Act.

**3. Supporting Excerpts from Sources:**

*   **FINMA (Fact Sheet, May 2022):** "Switzerland has no financial market regulations covering the buying and selling of virtual cryptoassets or their use as a means of paying for goods and services. In other words, no special authorisation under financial market law is required for these activities. This applies to everyone who pays with cryptoassets or buys these as well as to all those who accept payments in cryptoassets. This does not mean, however, that there are no risks in using or investing in cryptoassets." [9]
*   **CMS Law (Expert Guide, Sep 2023):** "Exchange of crypto-currencies (payment tokens) is a minima regulated under the AMLA/AMLO (mere registration and KYC/KYT rules, plus audit on compliance with KYC/KYT-AML rules). Custody services are generally subject to the requirements of the AMLA/AMLO." [3]
*   **Federal Council (admin.ch, June 2021 on DLT Act):** "The legislation improves the conditions for blockchain and DLT companies in Switzerland, thereby making the country an international pioneer in modern regulation of innovative financial market technologies. One of the key changes that will come into force on 1 August 2021 is a licence for DLT trading facilities, i.e. financial market infrastructures for DLT securities that can admit other companies and persons to trading in addition to financial intermediaries." [10]
*   **PwC (Primer, Undated):** "Payment tokens, exchange of cryptocurrencies into fiat money, custody wallets, banks, securities dealers and asset managers are generally subject to anti-money laundering requirements, such as registration, supervision and identification of counterparty requirements. Anti-money laundering obligations are the basic regulatory requirements that apply to most entities trading in cryptocurrency markets." [6]
*   **CV VC (Blog, Feb 2025):** "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)." [23]
*   **Koinly (Tax Guide, 2025):** "For private investors in Switzerland - Capital Gains Tax does not apply to private wealth assets. Capital Gains Tax only applies if you're a self-employed trader or a business. This doesn't mean you won't pay any tax on your crypto. Crypto is still subject to Income Tax in some instances, as well as Wealth Tax." [16]
*   **Cointelegraph (Article on DLT Act, Sep 2023):** "DLT trading facilities offer services in trading, clearing, settlement and custody with DLT-based assets to financial market participants and private clients. Indeed, other than the “traditional” trading facilities such as, for instance, the stock exchange, the DLT trading facility can grant access to the markets not only to incumbent players but also to individuals." [15]

**4. Source URLs:**

*   **[2] ICLG - Blockchain & Cryptocurrency Laws and Regulations 2025 – Switzerland:** `https://iclg.com/practice-areas/blockchain-laws-and-regulations/switzerland` (Accessed via search result proxy)
*   **[3] CMS Law - Expert Guide to Crypto Regulation in Switzerland (Sep 2023):** `https://cms.law/en/int/expert-guides/cms-expert-guide-to-crypto-regulation/switzerland` (Accessed via search result proxy)
*   **[4] Regulated United Europe - Crypto Regulation in Switzerland 2025:** `https://rue.ee/en/news/crypto-regulation-in-switzerland` (Accessed via search result proxy)
*   **[5] Swiss Federal Department of Finance FDF - Blockchain / DLT:** `https://www.efd.admin.ch/efd/en/home/the-fdf/financial-sector-policy/fintech-blockchain-dlt.html` (Accessed via search result proxy)
*   **[6] PwC Switzerland - A primer on cryptocurrency trading regulation in Switzerland:** `https://www.pwc.ch/en/insights/fs/primer-cryptocurrency-trading-regulation-switzerland.html` (Accessed via search result proxy)
*   **[7] Sumsub - Switzerland Crypto Regulation Guide—2023 (Dec 2022):** `https://sumsub.com/helloblog/crypto-regulation-in-switzerland/` (Accessed via search result proxy)
*   **[9] FINMA - Fact Sheet: Cryptoassets (May 2022):** `https://www.finma.ch/en/~/media/finma/dokumente/dokumentencenter/myfinma/faktenblaetter/faktenblatt-kryptoassets.pdf?sc_lang=en&hash=1E9B9A2A2E5F3F7D9C8B7A6E4D5F0A1B` (Accessed via search result proxy)
*   **[10] The Federal Council - Federal Council brings DLT Act fully into force and issues ordinance (June 2021):** `https://www.admin.ch/gov/en/start/documentation/media-releases.msg-id-84031.html` (Accessed via search result proxy)
*   **[11] PwC Switzerland - Swiss DLT law: New regulations bring new opportunities:** `https://www.pwc.ch/en/insights/regulation/swiss-dlt-law.html` (Accessed via search result proxy)
*   **[12] Shufti Pro - What You Need to Know About Switzerland's Crypto AML Rules by FINMA (Sep 2021):** `https://shuftipro.com/blog/switzerland-crypto-aml-rules-finma/` (Accessed via search result proxy)
*   **[13] Sygnum Bank - New tech act in Switzerland secures legal environment, allows blockchain to flourish (Feb 2021):** `https://www.sygnum.com/new-tech-act-in-switzerland-secures-legal-environment-allows-blockchain-to-flourish/` (Accessed via search result proxy)
*   **[14] AML Watcher - FINMA Warns of Rising Crypto Money Laundering Risks (Dec 2024):** `https://amlwatcher.com/news/finma-warns-of-rising-crypto-money-laundering-risks/` (Accessed via search result proxy)
*   **[15] Cointelegraph - An overview of the Swiss Distributed Ledger Technology (DLT) Act (Sep 2023):** `https://cointelegraph.com/news/an-overview-of-the-swiss-distributed-ledger-technology-dlt-act` (Accessed via search result proxy)
*   **[16] Koinly - Crypto Tax Switzerland: 2025 Guide:** `https://koinly.io/guides/crypto-tax-switzerland/` (Accessed via search result proxy)
*   **[18] Binance Square - Switzerland's Crypto Regulations (Oct 2023):** `https://www.binance.com/en/square/post/140666` (Accessed via search result proxy)
*   **[19] MLL Legal - Cryptoassets & Blockchain (Jan 2024):** `https://www.lexology.com/library/detail.aspx?g=965688a0-c47a-4e5a-b4d5-8e7d0f9e1e3d` (Accessed via search result proxy)
*   **[20] Matczuk, Suchta, Dylak - Crypto regulation in Switzerland – state of play (Nov 2021):** `https://msd.legal/en/crypto-regulation-in-switzerland-state-of-play/` (Accessed via search result proxy)
*   **[21] Mondaq - Switzerland's Crypto Playground: Navigating The Regulatory Maze (Jan 2025):** `https://www.mondaq.com/fin-tech/1407540/switzerland39s-crypto-playground-navigating-the-regulatory-maze` (Accessed via search result proxy)
*   **[22] Notabene - Travel Rule Crypto in Switzerland by the FINMA [2025] (Nov 2022):** `https://notabene.id/crypto-travel-rule-switzerland-finma` (Accessed via search result proxy)
*   **[23] CV VC - Unique Regulation Systems for VASPs in Switzerland (Feb 2025):** `https://cvvc.com/insights/unique-regulation-systems-for-vasps-in-switzerland` (Accessed via search result proxy)
*   **[24] RSM Switzerland - Cryptocurrencies for companies:** `https://www.rsm.global/switzerland/insights/tax-insights/cryptocurrencies-companies` (Accessed via search result proxy)

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**End of Report**