The reform of 2025 and 2026: payment instrument institutions and crypto institutions

The consultation of 22 October 2025

By 2025 the limits of the Swiss approach had become visible. The European Union had adopted a comprehensive regime for crypto-assets, the United States had enacted federal legislation on payment stablecoins,¹ and Swiss stablecoin issuers found themselves constrained by the default guarantee model and by the requirement to identify every holder. The fintech licence had attracted only a handful of 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: payment instrument institutions and crypto institutions. The consultation ran until 6 February 2026.² The Federal Council described the objective as maintaining the competitiveness of Switzerland in relation to jurisdictions that had already adopted more developed crypto regulation and implementing international standards.³

The draft marks a change of method. For the first time since 2016 Switzerland proposes a dedicated licensing regime for crypto service providers and a statutory framework for stablecoins, although it does so within the existing Financial Institutions Act. The tradition of targeted amendments is maintained in form, while in substance the reform introduces a sector-specific regime that invites comparison with the European Markets in Crypto-Assets Regulation.

Payment instrument institutions and stablecoins

The payment instrument institution replaces the fintech licence. The Federal Council presented it as a successor category with specific adjustments designed to make it more attractive and to improve customer protection. The CHF 100 million ceiling on client funds is removed. Client funds accepted by the institution are to be segregated in the event of its failure and excluded from the bankrupt estate. Payment instrument institutions may issue a specific type of stablecoin, subject to enhanced anti-money-laundering requirements.⁴ The draft calls these tokens stable crypto-based payment instruments and defines them as crypto-assets issued in Switzerland that are intended to maintain a stable value in relation to a single state currency and that carry a claim to redemption. Only payment instrument institutions may issue them. The issuer must publish a white paper.⁵

The reserve rules are central to the regime. Holders must have a claim against the issuer to redemption at nominal value at any time. The reserve assets must fully cover the outstanding tokens, be diversified and be denominated in the same currency as the redemption claim. In insolvency they are segregated in favour of clients and token holders. The issuer must notify FINMA at least sixty days before the first issuance.⁶ Client funds are to be held as a special fund protected from insolvency and invested in deposits with Swiss banks or in high-quality liquid assets with short maturities, such as sight deposits with the Swiss National Bank, government securities and money market funds. These funds are expressly outside the depositor protection scheme. A payment instrument institution may accept client funds without paying interest, issue stablecoins, provide payment services and hold stablecoins in custody, but it may not accept interest-bearing deposits, which remain reserved to banks.⁷

The draft also changes the approach to money laundering on the secondary market. The obligation to identify all holders, which FINMA had derived from existing law in Guidance 06/2024, is replaced by a model that relies on transaction monitoring, the blacklisting of wallet addresses and the ability to block or freeze stablecoins. Full identification remains mandatory for issuance and redemption. Banks and other financial institutions that wish to issue Swiss stablecoins must do so through a separate group company holding a licence as a payment instrument institution.⁸ Foreign stablecoins, as well as Bitcoin and Ether, fall into a residual category of crypto-assets with trading character. Their issuance requires no Swiss authorisation, but their offer through Swiss intermediaries is subject to conduct rules.

Crypto institutions

The second new category, the crypto institution, is intended for providers that hold crypto-assets with trading character in custody or trade in them. Its licensing requirements are modelled on those for securities firms but are less comprehensive. Crypto institutions must meet requirements designed to prevent conflicts of interest.⁹ The regulated activities include the custody of Swiss stablecoins and of crypto-assets with trading character, trading on behalf of clients, short-term trading for own account in the form of market making and the operation of organised trading facilities on which only crypto-assets with trading character are admitted. Banks and securities firms may act as crypto institutions, while asset managers, trustees and managers of collective assets may not. The rules of conduct of the Financial Services Act are extended to crypto services, including client segmentation, information duties, the suitability test for advice and duties of transparency and diligence.¹⁰

The draft provides for a uniform transitional period. Institutions already licensed under Swiss financial market law must comply with the new requirements within one year after the amended law enters into force. Providers that become subject to a licence for the first time must submit an application within one year and may continue their activity in the meantime if they are affiliated with a self-regulatory organisation under the Anti-Money Laundering Act.¹¹ For the many crypto brokers, exchange services and custodians in Zurich and Zug that have operated for years under SRO membership alone, the reform therefore means a transition into prudential supervision by FINMA.

Reactions in the consultation

The consultation produced a broad consensus on the objectives and a sharp disagreement about the means.¹² In a joint statement published in December 2025, the Swiss Blockchain Federation, the Crypto Valley Association, the Swiss Fintech Association and the Capital Markets and Technology Association welcomed the draft as an important signal while calling for improvements. They questioned why blacklisting should apply only to some types of stablecoin, criticised the requirement that banks issue stablecoins through separate payment instrument institutions as a costly bureaucratic hurdle, and warned that modelling the crypto institution on the securities firm could trigger a drastic market consolidation similar to that expected in the European Union. They also demanded that FINMA complete licensing procedures within six months.¹³

The Government Council of the Canton of Zurich adopted its response on 28 January 2026. It supported the proposal in principle because it would promote the digital business models of Swiss financial service providers and preserve the innovative strength and competitiveness of Switzerland. It nevertheless demanded substantial changes. The canton objected that the draft excluded the payment instrument institution from the authorisation cascade, under which a higher licence includes the lower ones, and argued that this infringed the principles of “same business, same risks, same rules” and of a level playing field, since it would in practice prevent the numerous smaller Swiss banks from operating a payment instrument institution. It called for sharper definitions of client funds, crypto-based assets with trading character, stablecoins and tokenised deposits, and for these terms to be set out in the statute itself. The canton considered the integration of crypto-assets into the Financial Services Act misconceived, because crypto-based assets do not qualify as financial instruments within the meaning of that act, and suggested separate rules on conduct. It regarded the liability for white papers as disproportionate and proposed limiting it to obvious defects. Finally it called for binding time limits for licensing procedures of six months and for regulatory guidance instruments going beyond no-action letters.¹⁴

The Zurich response is of interest beyond its content. It shows the canton, home to the Zürcher Kantonalbank and to most of the Swiss banking industry, positioning itself as an advocate of the established banks as well as of innovation. Its concern for the smaller banks reflects the structure of the Zurich market, in which regional and cantonal banks compete with specialised crypto institutions for the same clients. The Swiss Bankers Association submitted its own response in February 2026.¹⁵

Status in September 2026

The State Secretariat for International Finance had indicated that the dispatch to Parliament would follow at the earliest in the second half of 2026. As at the time of writing, no dispatch had been published that could be verified for this chapter, and the parliamentary deliberation had not begun.¹⁶ Meanwhile the market has begun to prepare for the new regime. In April 2026 a group of Swiss institutions comprising UBS, PostFinance, Sygnum, Raiffeisen, Zürcher Kantonalbank, Banque Cantonale Vaudoise and Swiss Stablecoin AG launched a sandbox to test use cases for a stablecoin linked to the Swiss franc throughout 2026. The initiative was declared open to other banks, companies and institutions.¹⁷ The participation of the two largest Zurich banks, UBS and Zürcher Kantonalbank, signals that the franc stablecoin is being approached as a matter of financial infrastructure and no longer as a niche product of start-ups.

Notes

Covington & Burling, “The GENIUS Act Becomes Law: Key Provisions from the Federal Stablecoin Regulatory Framework”, July 2025, https://www.cov.com/en/news-and-insights/insights/2025/07/the-genius-act-becomes-law-key-provisions-from-the-federal-stablecoin-regulatory-framework. The Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act) was signed into law on 18 July 2025 and created a federal licensing and supervisory framework for payment stablecoins and their issuers. ↩
State Secretariat for International Finance (SIF), “Federal Council moves forward with stablecoins and crypto: consultation launched”, media release, 22 October 2025, https://www.sif.admin.ch/en/newnsb/x4TMWQ1SWofNoFx7XyHhY. The consultation documents were published in German only. ↩
MoneyToday, “Konkrete Schritte des Bundesrates für Stablecoins und Kryptos”, https://www.moneytoday.ch/news/konkrete-schritte-des-bundesrates-fuer-stablecoins-und-kryptos. ↩
State Secretariat for International Finance (SIF), “Federal Council moves forward with stablecoins and crypto: consultation launched”, 22 October 2025, https://www.sif.admin.ch/en/newnsb/x4TMWQ1SWofNoFx7XyHhY. ↩
State Secretariat for International Finance (SIF), “Switzerland as a location for stablecoins and crypto”, fact sheet, October 2025, https://www.sif.admin.ch/dam/en/sd-web/dUviLBIEgTjT/Faktenblatt%20Stablecoins%20EN.pdf. According to the fact sheet, the dispatch to Parliament was to follow at the earliest in the second half of 2026. ↩
Bär & Karrer, “Swiss Federal Council Launches Legislative Process for Proposed New Regulation on Stablecoins and Crypto Services”, 22 October 2025, https://www.baerkarrer.ch/en/publications/swiss-federal-council-launches-legislative-process-for-proposed-new-regulation-on-stable-coins-and-crypto-services. ↩
Schellenberg Wittmer, “Neue Schweizer Regulierung für Stablecoins und Krypto-Dienstleister”, newsletter Banking & Finance, January 2026, https://www.swlegal.com/media/filer_public/e5/94/e594f039-c74c-485b-998d-26293a30419e/sw_nl_banking__finance_-_jan_26_german.pdf. ↩
Schellenberg Wittmer, “Neue Schweizer Regulierung für Stablecoins und Krypto-Dienstleister”, January 2026, https://www.swlegal.com/media/filer_public/e5/94/e594f039-c74c-485b-998d-26293a30419e/sw_nl_banking__finance_-_jan_26_german.pdf (on the secondary-market AML model and the separate-entity requirement for banks). ↩
State Secretariat for International Finance (SIF), “Federal Council moves forward with stablecoins and crypto: consultation launched”, 22 October 2025, https://www.sif.admin.ch/en/newnsb/x4TMWQ1SWofNoFx7XyHhY. ↩
Schellenberg Wittmer, “Neue Schweizer Regulierung für Stablecoins und Krypto-Dienstleister”, January 2026, https://www.swlegal.com/media/filer_public/e5/94/e594f039-c74c-485b-998d-26293a30419e/sw_nl_banking__finance_-_jan_26_german.pdf (on the activities of crypto institutions and the extension of the Financial Services Act). ↩
MME, Andreas Glarner and Aurelia Nick, “Switzerland proposes New Crypto License Categories and Strengthens Consumer Protection”, 3 December 2025, https://www.mme.ch/en/magazine/articles/switzerland-proposes-new-crypto-license-categories-and-strengthens-consumer-protection. ↩
velaw, “FINIG Vernehmlassung abgeschlossen – Was ist mit Krypto Instituten?”, 13 February 2026, https://www.velaw.ch/finig-vernehmlassung/. ↩
finews.ch, “Stablecoin-Vorlage: Ein wichtiges Zeichen, aber nun muss nachgebessert werden”, 9 December 2025, https://www.finews.ch/news/finanzplatz/70466-stablecoin-bundesrat-finanzinstitutsgesetz-finig-krypto-vernehmlassung-kryptoinstitute-kryptodienstleister-finma-bewilligungsverfahren-innovationsschub-emittenten-hans-kuhn-sbf-cva-sfta-cmta. ↩
Canton of Zurich, Government Council, extract from the minutes of 28 January 2026, RRB No. 99/2026, consultation response on the amendment of the Financial Institutions Act (payment instrument institutions and crypto institutions), https://www.zh.ch/bin/zhweb/publish/regierungsratsbeschluss-unterlagen./2026/99/RRB-2026-0099.pdf. ↩
Swiss Bankers Association, “Stellungnahme zur Änderung des Finanzinstitutsgesetzes (FINIG)”, 11 February 2026, https://www.swissbanking.ch/_Resources/Persistent/9/2/7/5/9275b673eccd1aeed7f0d69d16d82a7b4dfc2e1d/20260211_Stellungnahme%20SBVg_%C3%84nderung%20FINIG.pdf. ↩
State Secretariat for International Finance, “Faktenblatt Stablecoins”, 22 October 2025, https://www.sif.admin.ch/dam/de/sd-web/dUviLBIEgTjT/Faktenblatt%20Stablecoins.pdf, which states that the Federal Council will submit a dispatch to Parliament at the earliest in the second half of 2026. The fact sheet gives no date for entry into force. The status is assessed as at September 2026. ↩
Payment Expert, “Swiss banking giants launch CHF stablecoin sandbox”, 10 April 2026, https://paymentexpert.com/2026/04/10/swiss-chf-stablecoin-sandbox/. The sandbox was launched on 8 April 2026 with the stated aim of supporting the development of a Swiss ecosystem for digital money. ↩

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 September 2025.

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