The second legal limit: municipal law, treasury, money laundering and tax

Municipal autonomy and its boundaries

Swiss municipalities enjoy autonomy to the extent that cantonal law grants it, as Art. 50 para. 1 of the Federal Constitution provides.¹ In Ticino the framework is set by the cantonal constitution of 14 December 1997 and by the Legge organica comunale (LOC) of 10 March 1987, which defines the organs of the municipality, their competences and the rules on municipal finances.² Within that framework the promotion of the local economy, the organization of events, the operation of a municipal loyalty scheme and the choice of payment channels for municipal invoices are tasks that a municipality may take on. They require a budget basis where they cost money and must respect the principles of legality, equal treatment and proportionality that bind all public action.

Plan ₿ was built so that it would fit within these limits without any new municipal regulation. The memorandums are non-binding, the city's own expenditure has been small, the payment option is voluntary for citizens and costless for the city, and the loyalty scheme operates as an instrument of economic promotion. The decisions that the city council would have to take, on a significant credit, a regulation imposing obligations on citizens or a binding contract of substantial value, have not been required so far. This explains why the programme has been driven by the Municipio and why the city council has accompanied it mainly through inquiries and questions.³ Should Phase II lead to implementing agreements with financial obligations for the city, the council's approval would become necessary, and with it a public debate on costs and benefits that the programme has so far largely avoided.

Treasury and accounting: why the city holds no bitcoin

From the first day the city has insisted that it would not hold Kryptowerte und Digital Assets on its balance sheet.⁴ The insistence reflects the rules of municipal financial management. The Ticino regulation on the financial management and accounting of municipalities of 22 May 2019 (RGFCC) requires municipalities to observe the principles of thrift (parsimonia), which demands an examination of the necessity and financial sustainability of every expenditure, and of economy (economicità), which requires the choice of the most economical variant to achieve a public purpose.⁵ The accounts must give a clear, complete and truthful picture of the municipality's financial position. Financial assets that are not needed for the performance of public tasks (beni patrimoniali) must be revalued every year at their fair value.⁶

These rules would make a holding of bitcoin in the municipal treasury difficult to justify. Bitcoin would be a financial asset of the municipality, since it serves no public task directly. Its annual revaluation at fair value would carry the full volatility of the asset into the municipal income statement. In the second quarter of 2026 alone the price of bitcoin fell from about USD 68,200 to about USD 58,600, a decline of about 14 per cent within three months.⁷ A municipality that had placed part of its liquidity in bitcoin would have had to report such losses in its accounts and justify them before the council and the cantonal supervisory authority. The principle of thrift, which requires a prudent use of public money, is hard to reconcile with an asset whose value can move by a third in a few months. The regulation leaves the detailed accounting rules, including the method of revaluation, to a manual issued by the cantonal Sezione degli enti locali, and neither the regulation nor the principles it lays down contain any provision designed for holdings of this kind.⁸

The conversion of every payment into francs by Bitcoin Suisse therefore serves two legal purposes at once. It protects the city's claims, which remain claims in francs, and keeps the municipal balance sheet free of an asset class for which municipal accounting law makes no provision. The same reasoning explains why the cantonal pilot of 2022 transferred all exchange-rate risk to a third party and why Zug and Chiasso followed the same model.⁹ None of the Swiss public bodies discussed in this chapter holds bitcoin as a treasury asset, and the Swiss National Bank has publicly rejected proposals to add bitcoin to its own reserves.¹⁰

Notes

1. Federal Constitution, SR 101, Art. 50 para. 1 ("Die Gemeindeautonomie ist nach Massgabe des kantonalen Rechts gewährleistet"), https://www.droit-bilingue.ch/de-fr/1/10/101-50-58.html. ↩
2. Costituzione della Repubblica e Cantone Ticino del 14 dicembre 1997, RL 101.000, Art. 16 (the municipality is autonomous within the limits of the constitution and the laws), https://m3.ti.ch/CAN/RLeggi/public/index.php/raccolta-leggi/legge/num/1; Legge organica comunale del 10 marzo 1987, RL 181.100, Art. 13, 106 and 151 (financial management governed by the principles of legality, financial balance, thrift and economy), https://m3.ti.ch/CAN/RLeggi/public/index.php/raccolta-leggi/legge/num/65. ↩
3. laRegione, "Spiegato il protocollo d'intesa" (above). ↩
4. Allen, "Death, taxes and crypto" (above). ↩
5. Regolamento sulla gestione finanziaria e sulla contabilità dei comuni (RGFCC) del 22 maggio 2019, RL 184.150, Art. 3 (parsimonia) and Art. 4 (economicità), https://www.lexfind.ch/tolv/238787/it. ↩
6. Ibid., Art. 7 (clear, complete and truthful presentation) and Art. 15 (annual revaluation of financial assets at fair value). ↩
7. Stablecoin Insider, report on Tether's attestation for the second quarter of 2026, August 2026, https://stablecoininsider.org/tether-q2-2026-reserve-buffer-halved/ (bitcoin price at the beginning and end of the second quarter of 2026). ↩
8. RGFCC (above), Art. 7 para. 4 (the Sezione degli enti locali issues a directive in the form of a manual with detailed provisions) and Art. 15 (revaluation "secondo quanto indicato dal manuale"), https://www.lexfind.ch/tolv/238787/it. ↩
9. laRegione, "Il Cantone apre ai bitcoin" (above); Kanton Zug, "Steuern bezahlen mit Kryptowährungen", https://zg.ch/de/steuern-finanzen/steuern/inkasso/steuern-bezahlen-mit-kryptowaehrungen; Fortune Italia (above). ↩
10. Statements of the Chairman of the SNB Governing Board, Martin Schlegel, at the general meeting of shareholders of April 2025 and in later interviews, rejecting bitcoin as a reserve asset. ↩

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of August 2025.