Digital Lugano: Plan ₿, Kryptowerte und Digital Assets and Fintech — a part of the book Lugano as an International Financial Centre by Dr Alexander Ressos.
Part I describes Lugano's attempt to reposition itself as a centre for Kryptowerte und Digital Assets and technological finance, most visibly through the city's Plan ₿ with Tether.
This part belongs to Lugano as an International Financial Centre by Dr Alexander Ressos, published here in full, section by section.
Plan ₿: A City Adopts Bitcoin — overview and summary
On 3 March 2022 the City of Lugano and Tether, the issuer of the most widely used dollar stablecoin, announced a joint programme under the name "Plan ₿ ". Read more Lugano · Digital LuganoBefore Plan ₿: a financial centre in search of a new business
The decade before 2022 was the most difficult in the modern history of Lugano as a financial centre. Read more Lugano · Digital LuganoThe cantonal motion of 2017 and the pilot of 2022
At cantonal level the debate began with a motion of 16 October 2017 by Paolo Pamini, a member of the Grand Council for the Swiss People's Party (UDC) and an economist. Read more Lugano · Digital LuganoThe launch of 3 March 2022 and the memorandum of understanding
The announcement of 3 March 2022 was staged as an international event. Foletti and Ardoino presented a programme whose elements were set out in the first reports: a fund of CHF 100 million to be made… Read more Lugano · Digital LuganoThe mining project and the first controversies
Within three weeks of the launch the programme met its first serious criticism. In March 2022 reports appeared that the city was considering a public bitcoin mining facility with an investment of… Read more Lugano · Digital LuganoPaying the city in bitcoin and USDT
In its first phase the payment element of Plan ₿ was limited to certain online transactions with the city. Read more Lugano · Digital LuganoThe legal construction: payment through an agent
In legal terms the taxpayer who pays a municipal invoice in bitcoin does not pay the city in bitcoin. Read more Lugano · Digital LuganoLVGA, the MyLugano app and the merchant network
The least spectacular element of Plan ₿ is probably the one that reaches the largest number of residents. Read more Lugano · Digital LuganoThe legal characterization of LVGA
LVGA raises questions under financial market law that are treated systematically in Chapter I.II. Read more Lugano · Digital LuganoForum, foundation, education and symbols
The most visible product of Plan ₿ is its annual conference. The answer of the Municipio to the council inquiry of 2023 already mentioned a forum in October as one of the main activities agreed with… Read more Lugano · Digital LuganoEducation and research
From the beginning, education was presented as a central pillar. The first reports of March 2022 spoke of grants for some 500 students. Read more Lugano · Digital LuganoPhase II: the memorandum of 3 March 2026
On 3 March 2026, four years to the day after the launch, Foletti and Ardoino signed a second memorandum in the council chamber of the Palazzo Civico. Read more Lugano · Digital LuganoLegal questions raised by the five pillars
Each pillar touches an area of law in which the municipality's freedom is limited. Read more Lugano · Digital LuganoThe first legal limit: the Swiss franc as the only legal tender
The most fundamental limit on Plan ₿ lies in the federal constitution. Under Art. 99 para. Read more Lugano · Digital LuganoWhat "legal tender" means and what it does not mean
Legal tender has a precise legal function. It is the means by which a debtor can discharge a debt denominated in francs against the will of the creditor, and which the creditor cannot refuse without… Read more Lugano · Digital LuganoThe second legal limit: municipal law, treasury, money laundering and tax
Swiss municipalities enjoy autonomy to the extent that cantonal law grants it, as Art. 50 para. 1 of the Federal Constitution provides. Read more Lugano · Digital LuganoAnti-money laundering law
The anti-money laundering dimension was the most serious objection raised in the cantonal parliament in 2021, when the minority report warned that wallets held outside recognized financial… Read more Lugano · Digital LuganoTax law and the taxpayer's perspective
Three questions of tax law arise from Plan ₿. The first, the payment of taxes, has been answered above: the city accepts payment in bitcoin and USDT for the municipal tax and its other invoices,… Read more Lugano · Digital LuganoThe partner: Tether and the reputational question
Tether was founded in 2014 and issues USDT, the first and by far the most widely used stablecoin, a token that is meant to maintain a value of one United States dollar and that is backed, according… Read more Lugano · Digital LuganoTether's position after 2022
Since the launch of Plan ₿, the regulatory environment for stablecoins has changed in all major jurisdictions. Read more Lugano · Digital LuganoComparisons: Zug, Zermatt, Chiasso and El Salvador
The obvious Swiss comparison is Zug. The City of Zug began accepting bitcoin for municipal fees up to CHF 200 in 2016. Read more Lugano · Digital LuganoEl Salvador: the national experiment
The most frequently cited international comparison is El Salvador, which in 2021 became the first State to make bitcoin legal tender. Read more Lugano · Digital LuganoWhat Plan ₿ has done for Lugano's financial centre
The clearest effect of Plan ₿ is visibility. Already in March 2023 the Municipio reported that the programme had produced worldwide media coverage and an effect on the city's image that exceeded its… Read more Lugano · Digital LuganoThe link with the established financial centre
The weakest link of Plan ₿ is its connection with the existing financial industry of Lugano. The payment system runs through Bitcoin Suisse, a company based in the canton of Zug. Read more Lugano · Digital LuganoThe Legal Framework for Kryptowerte und Digital Assets in Switzerland — overview and summary
When the City of Lugano announced its Plan ₿ with Tether in March 2022, it could build on a body of Swiss law that already treated Kryptowerte und Digital Assets as a regulated field. Read more Lugano · Digital LuganoFrom the first token sales to FINMA's taxonomy
Switzerland entered the market for Kryptowerte und Digital Assets through foundations in the Canton of Zug. Read more Lugano · Digital LuganoPre-financing, pre-sales and the ruling procedure
The guidelines also addressed two practices of the token market. In a pre-financing, investors paid in advance for tokens that would be created only later, and in a pre-sale they acquired, before the… Read more Lugano · Digital LuganoThe stablecoin supplement of 2019
On 11 September 2019 FINMA published a supplement to its ICO guidelines dealing with stablecoins, tokens whose value is linked to an asset such as a currency, a commodity, real estate or securities. Read more Lugano · Digital LuganoThe DLT Act: architecture and timetable
The legislative response began with a report. On 14 December 2018 the Federal Council adopted a report on the legal framework for distributed ledger technology and blockchain in the financial sector. Read more Lugano · Digital LuganoThe method of technology neutrality
The DLT Act avoided the word "blockchain" and the word "cryptocurrency" in the statutes it amended. Read more Lugano · Digital LuganoLedger-based securities and DLT trading facilities
The central innovation of the DLT Act is the ledger-based security ( Registerwertrecht, in Italian diritto valore registrato ), regulated in Articles 973d to 973i of the Federal Act of 30 March 1911… Read more Lugano · Digital LuganoLedger-based securities in the financial system
The DLT Act connected the new category with the existing law on intermediated securities. Read more Lugano · Digital LuganoThe first licence: BX Digital AG
For four years no DLT trading facility was licensed. On 18 March 2025 FINMA granted the first licence to BX Digital AG, a sister company of the BX Swiss exchange in the Boerse Stuttgart Group, to… Read more Lugano · Digital LuganoSegregation in bankruptcy and the custody of Kryptowerte und Digital Assets
Before 2021 the position of a client whose bitcoin was held by a bankrupt exchange was uncertain. Read more Lugano · Digital LuganoStaking: Guidance 08/2023
The question of permanent availability became acute with staking. In proof-of-stake networks such as Ethereum after its transition in September 2022, holders who lock their tokens as collateral for… Read more Lugano · Digital LuganoThe lessons of 2022
The year 2022 tested these rules. In May 2022 the algorithmic stablecoin TerraUSD lost its peg and the associated token Luna collapsed, destroying tens of billions of dollars of market value within… Read more Lugano · Digital LuganoThe banking perimeter, the FinTech licence and the banks
The Banking Act reserves to licensed banks the commercial acceptance of deposits from the public. Read more Lugano · Digital LuganoThe FinTech licence
With effect from 1 January 2019 Parliament introduced, in Article 1b BankA, a licence for institutions that accept public deposits up to CHF 100 million on condition that the funds are neither… Read more Lugano · Digital LuganoBanks specialized in Kryptowerte und Digital Assets
The first Swiss banks specialized in Kryptowerte und Digital Assets received their licences in August 2019, when FINMA granted banking and securities dealer licences to SEBA Crypto AG in Zug and to… Read more Lugano · Digital LuganoStablecoins under current law
Under the law in force in 2026, Switzerland has no special statute for stablecoins. Read more Lugano · Digital LuganoAnti-money laundering law and the travel rule
The Anti-Money Laundering Act was the first body of Swiss financial market law to reach the providers of services in Kryptowerte und Digital Assets. Read more Lugano · Digital LuganoThe travel rule without exception
In payment transactions Swiss law has long required that the originator's name, account number and address accompany a wire transfer, so that the receiving institution knows who sent the funds. Read more Lugano · Digital LuganoThe reform of 2025 and 2026: payment instrument institutions and crypto-institutions
On 22 October 2025 the Federal Council opened a consultation on an amendment of the Financial Institutions Act that would introduce two new licence categories. Read more Lugano · Digital LuganoCriticism in the consultation
The industry welcomed the direction but asked for changes. In December 2025 the Swiss Blockchain Federation, the Crypto Valley Association, the Swiss Fintech Association and the Capital Markets and… Read more Lugano · Digital LuganoTaxation of Kryptowerte und Digital Assets in Switzerland and Ticino
Swiss tax law contains no special provisions for Kryptowerte und Digital Assets. The Federal Tax Administration (ESTV, in Italian AFC) has set out its practice in a working paper on the treatment of… Read more Lugano · Digital LuganoIssuers, withholding tax, stamp duties and VAT
For the issuer of a token, the working paper distinguishes by category. Proceeds from the issue of utility tokens are taxable income of the issuer and must be recorded as income at the time of issue,… Read more Lugano · Digital LuganoSwiss law meets MiCAR: serving Italian clients from Lugano
The European Union regulated Kryptowerte und Digital Assets through Regulation (EU) 2023/1114 of the European Parliament and of the Council of 31 May 2023, known as MiCAR. Read more Lugano · Digital LuganoThe Italian implementation
Italy adapted its law to MiCAR by Legislative Decree No. 129 of 5 September 2024. The decree designates CONSOB and the Banca d'Italia as competent authorities and divides their tasks by function. Read more Lugano · Digital LuganoLugano's market and a practitioner's checklist
Lugano's market for Kryptowerte und Digital Assets consists of three groups. The first comprises the specialized banks and brokers from other parts of Switzerland that have opened offices in the city… Read more Lugano · Digital LuganoLaunching a service from Lugano
For a provider of exchange, brokerage or custody services the steps differ. The provider must first decide whether it will hold client assets and in which form. Read more Lugano · Digital LuganoFintech, Research and Artificial Intelligence in Ticino — overview and summary
For most of its history the financial centre of Lugano lived from proximity, language and discretion. Read more Lugano · Digital LuganoA university for the third financial centre
Ticino was the last region of Switzerland with a national language of its own to obtain a university. Read more Lugano · Digital LuganoGrowth and the faculty of informatics
The university expanded in two directions after 2000. In 2004 it created the Faculty of Informatics, the first faculty of computer science in the Italian-speaking part of Switzerland, and in 2008 an… Read more Lugano · Digital LuganoFinance research and professional training
Research in finance at USI is concentrated in the Institute of Finance ( Istituto di finanza, IFin) of the Faculty of Economics, which is affiliated with the Swiss Finance Institute (SFI). Read more Lugano · Digital LuganoContinuing education with the banking sector
The link between university research and banking practice runs through continuing education. In December 2019 USI announced a lifelong learning initiative of the Swiss Finance Institute in Lugano. Read more Lugano · Digital LuganoIDSIA: artificial intelligence in Lugano since 1988
The oldest of the research institutions described in this chapter was founded by a private benefactor eight years before the canton had a university. Read more Lugano · Digital LuganoOther lines of research: ant colonies, robots and reasoning under uncertainty
IDSIA's work is broader than neural networks. In the 1990s Luca Maria Gambardella, who later directed the institute for many years, and Marco Dorigo developed the "ant colony system", a method of… Read more Lugano · Digital LuganoCSCS: national supercomputing on Lake Lugano
The Swiss National Supercomputing Centre ( Centro Svizzero di Calcolo Scientifico, CSCS) was founded in 1991 as a unit of ETH Zurich, which still operates it. Read more Lugano · Digital LuganoPiz Daint, Alps and MeteoSwiss
For a decade the flagship of the centre was Piz Daint, a Cray system installed in the new building in December 2012 and progressively upgraded with graphics processors. Read more Lugano · Digital LuganoInnovation policy, start-ups and fintech in Ticino
The canton organizes its support for start-ups and innovative small and medium enterprises through the foundation AGIRE ( Fondazione AGIRE ), established in 2011 by the canton's Department of Finance… Read more Lugano · Digital LuganoFintech companies: a small sector
Measured by the narrow definition of the Institute of Financial Services Zug (IFZ) of the Lucerne University of Applied Sciences and Arts, which counts companies whose core business is the provision… Read more Lugano · Digital LuganoTechnology in the established financial industry
The most important users of financial technology in Ticino are the established institutions. Read more Lugano · Digital LuganoArtificial intelligence in banking and compliance
The first large-scale use of machine learning in Swiss banks was in compliance. The Anti-Money Laundering Ordinance of FINMA requires banks and securities firms to monitor their business… Read more Lugano · Digital LuganoFINMA Guidance 08/2024
On 18 December 2024 FINMA published Guidance 08/2024 on governance and risk management when using artificial intelligence. The guidance does not create new rules. Read more Lugano · Digital LuganoResponsibility remains with the institution
The use of artificial intelligence does not shift legal responsibility. Under the Anti- Money Laundering Act the financial intermediary must clarify the economic background and purpose of unusual… Read more Lugano · Digital LuganoData protection and banking secrecy in the age of artificial intelligence
The Federal Act on Data Protection of 25 September 2020 (FADP) entered into force on 1 September 2023 and replaced the act of 1992. Read more Lugano · Digital LuganoBanking secrecy and professional secrecy
For banks, the FADP is overlaid by banking secrecy. Art. 47 of the Banking Act makes it a criminal offence for bank organs, employees, agents and auditors to disclose secrets entrusted to them in… Read more Lugano · Digital LuganoOutsourcing, operational resilience and cybersecurity
Most artificial intelligence used by Lugano financial institutions is supplied by third parties, and much of it runs in the cloud. Read more Lugano · Digital LuganoCircular 2023/1: operational risks and resilience
FINMA Circular 2023/1 "Operational risks and resilience – banks" of 7 December 2022 entered into force on 1 January 2024 and replaced Circular 2008/21 on operational risks of banks. Read more Lugano · Digital LuganoLugano providers and Italian banks: the reach of DORA
The rules on operational resilience have a cross-border dimension for Lugano. Some Ticino companies provide IT services, software or data processing to banks and financial institutions in Italy. Read more Lugano · Digital LuganoTwo models of regulating artificial intelligence: Bern and Brussels
Switzerland has no general law on artificial intelligence. On 12 February 2025 the Federal Council decided on its approach after reviewing an overview of possible regulatory models that the Federal… Read more Lugano · Digital LuganoThe European Union's Artificial Intelligence Act
The European Union chose the opposite model. Regulation (EU) 2024/1689 of 13 June 2024 laying down harmonised rules on artificial intelligence (the AI Act) was published in the Official Journal on 12… Read more Lugano · Digital LuganoFinancial services under the AI Act
Two categories in Annex III concern the financial sector directly. Artificial intelligence systems intended to be used to evaluate the creditworthiness of natural persons or establish their credit… Read more Lugano · Digital LuganoTalent, the cross-border workforce and the outlook
The knowledge infrastructure described in this chapter employs several hundred researchers and staff. Read more Lugano · Digital LuganoScenarios for research, technology and the financial centre
Three developments will shape the role of research and technology in Lugano's financial centre over the coming decade. The first is the institutional consolidation of training and research. Read more