How Would You Regulate Crypto Instead of the Regulators?

Transcript

hello everyone it's a pleasure to to have you here uh my name is Gabriel Jacquard I'm the CEO of rb3 a One-Stop shop based in Geneva and uh I have the the pleasure today to host this uh this panel with bibomsey uh bye if you want to to introduce yourself in a in a few words hi guys I'm UMC I'm a former regulator and um I have my practice on regulatory but in Luxembourg and in so it's a pleasure to to to discuss with you and uh to to um to present with the with deba that is a

very uh deeply appreciated uh friend of mine now I believe we can even say that and um the topic of uh today is the discussion will be actually to to let you come up with uh your paramatic and to discuss overall the the the question of uh of regulation in um in Switzerland and uh also in uh in uh in your respective jurisdiction um still in a few in a few words um we'll have this one hour discussion around regulation uh the idea is really for for you to to give us uh the the your practice sorry there's lots of

noise of people joining in so that's why I'm kind of a bit confused so we'll discuss during one hour about regulation uh what could be improved what should be improved and um this uh this call will have a special meaning because um in uh with the regulatory working group of the CVA we are about to meet uh the the three Securities that actually had um uh wrote and discussed with also the parliament the the creation and and the the release of the DLT act one so the first set of Regulation that uh was implemented in Switzerland in 2021 so the whole idea of today's call is to

help us as the regulatory working group of the CVA really bring forward your ID and make sure that if there is some practical problems that really comes up in a specific domain in the practice of you you guys as you're probably all entrepreneur and close to this crypto industry crypto Market that we're able actually to bring forward some concrete proposal to the Swiss legislator because there will be the one the sieve they will be the one actually creating the Lex dlt2 so the next uh the next leg up with regard to the regulatory regime in Switzerland so um the the whole uh the whole event will be recorded of course you have uh

for example you can see if I move here you have or email address uh and you can always contact us via uh the the usual uh channel of communication of the CVA if you want to put some stuff in writing it would really help us um discussing with you about the concrete paramedics that you may face so again so that we can indeed bring forward uh some ideas to the regulator so that they're regulated the best way possible now that we introduce in five minute the presentation um the floor is kind of yours please if you want to to participate and to

discuss a topic you can simply request in the in the chat or just request by raising your hand uh um and opening your your camera uh you can request the the the floor and I will I'll let you then open your mic if that's okay with you otherwise I'll just uh bring some topics to the table so who wants to to bring forward a regulatory concern that they find in their practice I believe in a Marie Patricia you're opening your mic you can open your mic your mic is off sorry I didn't mean to unmute sorry

about that I'm fine thank you I'm I'm interested but I don't have a question at this stage okay a little bit um the brainstorming we had within the working group and and some of the points that came in uh came up actually uh so we can then open the floor everybody can jump in absolutely so let's uh let's bring forward some ideas uh concrete ideas so maybe be bad if you want to to um to begin so one of the the with the AML Maybe um actually meanwhile I had one that came up here and I would be very happy I

don't know who are actually uh based in Switzerland and who are not but um I have the advantage maybe the disadvantage of being both um in Luxembourg in the EU and in Switzerland and more and more I'm thinking about should what I like in Switzerland is actually that um we have this qualification of token that is quite straightforward to be honest um and did not change much since 2019 although with some adjustment and from from the practice and from on FEMA's position however it's quite a thinner now it does not really fit what is uh in

the EU I mean financial instruments sure it's me if it too that's fine um payment token uh psd2 yeah that's fine only me it's fine um however we acquired a strong adamant to say that the utilities token when qualified do not fall under any regulation which is completely the opposite if we think about Mika so I'm wondering whether we should actually strengthen this position and it makes sense actually from from a financial regulation not to come uh to to qualify something that is actually not related to to

financial markets regulation however can we live in an island uh should we consider it equivalent somehow that's something that is still going on in my head um Misha hopefully will be fully translated and published in the build town office here the official Journal I have rilome so we will be uh enforced in 2014 24 sorry so we have one year but this is one question is it is it a is it really an advantage to have something quite straightforward and simple or are we

actually hated ourselves and isolate ourselves yeah so the do we um so it's a it's a it's a great question actually I I didn't really thought of uh things like that what is certain is that Mika will have a deep impact on on what how we do and how we should see things also from Switzerland we might have also a Competitive Edge um maybe do you have uh anything on the floor do you think that uh we leveraged the the power of the Swiss regulation the right way or should we rather you know kind of adapt to uh to the Mika's environment and make sure that we're just one big

that we don't we have like only one definition or around the the EU the Switzerland being not an island within this regulatory framework I think Switzerland is quite actually um competitive also with the UK UK is is smart enough to actually adjust as well I don't know I don't know but we need to really keep keep things um uh yeah around and look at that and not getting isolated as we we had in the past for the financial markets in terms of Market access I mean not in the crypto but in the in the in the

passporting and the equivalence it's certain that it will be completed yeah we won't be able to to actually live isolated that's for sure especially from a regulatory side I believe there is someone opening this Camp Govinda or Dua do you want to to discuss uh something do you want to make a point or just a no no I just got in here sorry okay okay uh so the the so Maxim do you ever take well um I would like to bring up one point that really uh bothers me in terms of Swiss regulation in more from my compliance kyc point

is that um the the world of fintech and crypto really really pushes forward um scalable and fast onboarding and the best way there is online identification and with thousands of good tools out there those things can be done very very efficiently and this is the global standard in any country outside of the world people are doing onboarding with like pointing their phone on their identity card and maybe take a selfie and move their heads and there we go a few seconds later you have an open account while in Switzerland we have the online video identification circular

and it requires additional things and in online identification they would require a bank transfer which if you talk about a bank a crypto to crypto type of model is maybe not even applicable it's it's not a no-go but it it's uh killing some of the context the other version would be video identification and a it's not much more secure B it takes time on the company side that takes time on client side it costs a lot of money it's not scalable in general but there is no bank transfer required and no proof of address verification

things are there so most Swiss companies are going that tough but this is this is the path towards um becoming inefficient and create a terrible experience in user onboarding and last but not least the requirement of verifying The Beneficial ownership with Dragon Blood signature on paper stuff like that or qualified electronic signature which I never saw in reality I know it's supposed to exist but never ever had a chance to actually use it so there is a requirement that was created in with

thoughts of of a more secure possibility to create online verification of people but it was created with imaginary technology in mind and it's killing the current uh business because outside of Switzerland there are much more efficient ways to actually onboard things and it even seems that the Swiss regulator doesn't want that maybe maybe they want to kill retail business in pintech or crypto world and just focus on B2B because all the B2B companies say well 50 pages of onboarding sure we can do that and they live with that so this is really something that I'm really more than than if like uh bothered with

because I really think this is in a longer uh effect that we are not uh seeing right now that this little thing would even the bank transfer orders the qualified electronic signature will uh have in in a couple of years and that is something that really could be fixed so easily if if we address that to the regulator I'm sure you have a great reaction to that because you were the regulator at some point I think it's uh it's the the seven um I think it's uh it's a circular punch in math so even if we bring it to the Sea as no legal power and thing moment we can definitely bring that forward are

you agree with you I don't know why but the online video identification in Switzerland but I mean not necessarily only in Switzerland it's somehow disconnected from from from the purpose actually and then they use the same for the signature I have never actually used it a qualified signature I've used it yeah please go home um so that that's existing uh and it's it's not a very painful procedure to sign with a qualified uh signature um and um if I may the base for who uh about private sphere private sphere has a perfect product on the market it's easy

to use so it's a no-brainer if you want to sign uh with qualified signature uh contact privosphere use it okay but the thing is because Maxim was she's talking about those retail and I believe and I can I can use it I'm old enough I'm old enough to have an answer for that one too the Swiss market is not targeting the retail Market um we leave that to other uh jurisdictions we're not friends we're not Germany we're not the UK we are private banking Market historically and that also filtered through to the new regulation um uh and and frankly uh Swiss banks are

not good competitors in retail markets so don't go there everyone who tried to go there failed miserably looking back at the last 20 years Swiss banks who tried to roll out products in retail markets they're just too expensive period we don't necessarily have only banks right yeah yeah yeah but you know any any fintech who wants to yes who wants to conquer the retail Market should not try to do that out of Switzerland uh it's just it's just the Baseline it's just too expensive go go to Estonia go to any country with 20 of living costs uh of Switzerland

um do it in in the regulated EU sphere choose a country with a crypto affinity and educated people but don't try why should a Swiss fintech try to compete with an Estonian fintech in and if honestly as a former compliance officer an NCT that is coming from Estonia an entity that is has is set up in Switzerland it's not the same uh his country it's not the same rate it would not be the same impressive classification

and that's easier for the business well you know uh the Swiss rating is not as good as we we want to believe it and we're still tax Haven where we're still a mushy uh jurisdiction um looked from the outside I've I've said it since 2004 since I worked for the Liechtenstein FIU and um Switzerland is not as good as we want believe it to be um and as as long as you have a new jurisdiction you'll find globally speaking will uh discriminate any company based

in another EU member State the problem is that in EU you have way more um uh um requirements in terms of of uh individuals compared to Switzerland if you take the Clinique feed leg compared to Miffy too I know I've implemented I've implemented all EU regulation in in the eea yeah so you know that the the feed leg for instance or for those who are not in Switzerland it's more or less the equivalence of me if it too but way lighter

um if you don't Target um EU citizens I don't know why you would go actually to hold these requirements when you can actually Market the the word uh from seasoning and not in the EU well but I think let's let's just maybe cut short to that I just would like to to refresh there the ideas to have a debate note about you know the economic situation of Switzerland we just want to know whether you know and I believe your health at first you wanted to to discuss a point with regard to the ml so we we understood that you kind of disagree because of the economics of the Switzerland I believe this is debatable and and I believe it was about to be

debated but with regard to concrete proposal that that you would make basically you would say that there is no AML uh problematics and you would not have eventually and that's what I got from Maxim's uh intervention potentially a lighter idea verification that would apply that would give a hedge to uh the the stakeholders that wants to Target even though if you think it's a bad idea the retail do you have any other points to make around around that Ralph yes if Switzerland was to introduce a lighter approach with regards to kyc and AML that would hit us heavily in the next Mutual evaluation by the fatf

the last the last fhtf evaluation we barely survived it came out well but uh the I know the fatf has some Target points um on the Swiss uh back and they are ready to shoot uh whenever we give them the occasion so email is definitely a heated topic uh and it was it was actually some of the point that we really wanted to bring forward not W because there were tons of uh of uh criticism that came and I want to redirect them a little bit next to this identification process we also had those threshold this 1000 Swiss franc

threshold that was discussed under the obf in mass or the ordinance of the the finma so again it's all it's a it's again something that relates to finma so not sure that the the the thief will be very competent to to do so but um do you have a take or does anyone has a take about this thousand Swiss franc threshold uh did someone like suffered from it it was also directed to to certain activities relating to blockchain uh is there is there a theme to to discuss about that do you think uh to receive should we discuss that with this if the threshold given by the maximum do you have a take actually last um July I think we already had a

conversation with Sif um as under the crypto Valley Association AML working group cover and we we brought that to their attention and well I think Chris here on the call she was also part of that conversation as you can also add something to it but like from from the practice that again really well matches with the um the feeling that Switzerland is really limiting retail business activity and and uh is while pursuing the the well the bigger the the institutional

professional B2B type of activity and it's it's very difficult to even consider any kind of use case properly implementing the 1000 Swiss franc Rule and um I know for sure that but I worked with the company they're trying to build ATMs uh here in Switzerland and it's it's not real a thousand Swiss franc rule that we have to apply there because it's actually impossible to assume that there is no connected transaction if you deal with an ATM so if essentially you have to do kyc from the beginning or some sort of light kyc otherwise it's just not working and well

you can also call it the zero uh rank rule it won't change too much because you really have to to implement some sort of controls from the from the beginning yeah I agree I think it was not really thought completely I mean this this article 51a um has actually been implemented quite I would say hastily um it's also um taken into perspective that the transfer of the application of the travel of all the identification the travel rule is 1000 in the EU so you end up in Switzerland having the application

of the travel rule from zero the identification of ATM and maybe some conversion if you speak with file qf or with others you have also the tenancy of not only focusing on ATM but also crypto to crypto or crypto Fiat which I don't understand because they should not leave yet at all um and so there is a little bit of mix-up to be honest between these two this new 20 51a identifications poetically uh for ATM but not only for ATM if you look at the essay rules the travel rule at zero and on the other side front from the EU a

travel room from 1000 so here there is something that actually doesn't match Switzerland is stronger in one point and lighter in another one compared to other countries and we all know when we are supporting uh crypto players that actually compliance and EML that have a rule and kyc identification they are the very first thing that the the the the players are asking so so it should be you should be clear and straightforward is is there any take from uh from the floor for anyone wants to react to that

uh uh please open your mic open your camera and feel free to to speak I think there is a one person go on please uh my whole point is about uh regulation as such uh why is it so necessary to regulate crypto at this stage when The Regulators don't understand it when the technology is still premature it's like uh only the foundational layer of this technology is being laid right now uh use cases are not clear how it will evolve is not

clear uh how future use of let's say Technologies like ZK knowledge proofs and things will apply to securing data and how those Technologies can be used for uh better regulation subsequently I mean there are so many variables but the focus is on how do we regulate how do we control so the whole as I understand the whole crypto movement is about peer-to-peer it's not about control from above which seems to be the focus of this discussion and the discussions that I've heard on

regulation why why is this my my whole question is why is this regulation I can try I can try to give you maybe an answer so the the the main the main point that uh um so we we got actually the the question very often and the key point is that from the regulator's perspective you need to find intermediary you need to to put the liability of a certain activity upon the shoulder of someone and you might disagree but that's how the social system as a whole function then uh depending on the activity that you have in the end you're a service provider and you need to have in a in a market that we that we as we we do have today you need to have an equality of treatment

between people having uh activity that are similar that's uh the the main the principle of equality so basically um whenever you have the regulator they try to kind of implement and this is how we also want to change things uh they want to implement this all the models of finding an intermediary even though they're they're none and I would disagree with you uh upon the fact that you know that we we don't need any regulation Etc I think we do need a regulation there that's all the use cases that that you see in the journal that actually calls for it because regulation we should just forget and I'll let you answer to that but we should never forget what we have regulation in the first place regulation

is here to actually uh to actually make sure that our our social uh interaction are actually based on some kind of fairness and make sure that the rules of the game are not I'm not tricked and what we saw from crypto actors crypto stakeholders is that at some point there were there were some needs to actually have some control in the control from the regulator might not be uh most uh most appropriate in most most of the time but it is necessary in any case I'll let you react to that your mic is a is of is a h look the the I mean as I understand the whole movement

is against the established order it's against the established way of doing things this against the whole idea of centralized control so The Regulators are representing exactly the kind of power centers Global power centers okay which crypto is against it so how can you ever expect uh Fair regulation from the people you are up against uh so again I I must remind that we're speaking here mostly about Switzerland I

believe that it's interesting to see you know others perspective but I don't believe that in in Switzerland at all we're up against you know crypto I believe the the requirements are sometimes quite high but we're actually very well known to be a crypto Nation crypto friendly nation and we have some incredible things uh like The Lex DLT that just enter in force in 20231 enables anyone to actually create adapt obligation the shares under the form of token directly in one of the oldest book that we have the oldest legal book so I believe you know it's a it's a really uh maybe uh too extreme at least at the the the the Swiss uh the Swiss level now that we discussed a little bit this AML we spoke about this uh thousand Swiss

franc limit that was also discussed by the AML working group about the travel rules about eventually lighter ID uh as we only have one hour we'd like to to discuss another point that really occupied or thought if that's okay with you Bieber yeah okay well one of the the key point that we we also Focus during our discussion is actually where the Switzerland uh is actually missing an industry and especially we we talk about stablecoin uh when when we heard about um uh you know with Maxim speaking about the the kyc and the fact that kind of some kind of the regulation might try to even kind of factually kill the the industry uh we really found that that

use case being implemented with stablecoin because as of now we don't have any meaningful stable code in Switzerland we're all trading and the defa is happening uh with the usdc usdt which might be um uh debatable as a whether it should be the case but what is certain is that we won't have any uh decentralized Finance happening in Switzerland uh so long there is no uh there are no uh Swiss franc stablecoin and the use cases that we have for Swiss franc stablecoin are actually based abroad which is a very big irony in the country of the bank as it was mentioned just before so what do you think of it does anyone has or is running a stablecon project and um

do you think that we should bring forward this point the question of stablecoin uh to to the the stiff and eventually make sure that uh there would be I don't know a Sandbox sandbox or doing having something relating to stablecoin in the regulation that would make it lighter and give a chance also to private actor in The in this sector what do you think of it the floor is yours that's the whole point of this uh this call so please take the the floor foreign from a regulatory point of view that uh

we we kind of have you know this uh stablecoin guideline uh redacted by the cinema uh we had this one to one ratio that was implemented which is a big also impediment whenever you think uh that actually none none of the bank uh actually keep a one-to-one ratio of the assets they have uh on their balance sheets so we could also argue that it's some kind of an equity of treatment um and the the the and it's actually linked to uh what Biba said at the beginning with regard to the qualification of the token and how we see things it's very linked to that because whenever we we decide that that uh we need a one-to-one ratio to create

so once We Shrunk once uh equal one stable coin to to a to retain from a legal point of view of qualification that would be a deposit under banking law by doing by doing this operation we just first give them an ability to to Banks and uh we we also we also said that whenever there is not a one-to-end ratio or create a derivative hence bringing back from you know the back door the whole question of oh you have a financial instrument which makes it untredable on the secondary Market except if you're on a pure pure peer-to-peer type of system so yeah we wanted to bring forward this uh this

question because um we think it's uh it makes a lot of sense to use a Swiss franc stable coin instead of everyone using usdc especially at the time of uh where the USD is actually kind of tend to becoming a kind of a promatic type of currency and uh it would be uh I believe a decision factor for Enterprise and for company if we could actually trade uh with a CHF on step upon and I know that there are some use cases out there uh with Switzerland and uh you know with some banks that created some stable coin the thing is we don't have any industry in this which is kind of weird for the crypto Nation

if you look back actually when I was hearing you uh if you look back to what happened with um the embargoes and the ofax section by using the dollar uh uh and and and some um some Swiss bank French Bank um having to um they actually modified the Swift messages to avoid the vaccinction a few years ago um the the Thai Point why the regulator and why ofak was able to sanction was the fact that they were using the US dollar so I think that actually our industry

did not really learn the lesson because by actually using the Dollar by usdc and usdt you are actually tying you up with potentially U.S regulators and having a tight Point um should you apply the U.S regulation and you know you don't have to deal with one regulator you have to deal with also with the SEC with the ecftc with the New York DFC uh DFS and so on and so forth yeah I believe that it makes a lot of sense and there's a great article uh

written by uh by a professor from the University of Zurich I don't remember her name um but she wrote about about this this question of jurisdiction and basically whenever you have a U.S Bank in the loop or linked to whatever you're doing you basically fall under U.S jurisdiction which can be extremely problematic uh especially for uh for banks any reaction to to this question of stable coins I was I was hoping you know it would be the the biggest hit would be shocked would be alarmed would be uh reacting uh do you have any any takes uh from the floor so I mean here we don't we don't need actually when you

speak to to rush you don't need to identify yourself and say this is what I experienced we are not here to actually speak about you in general what we are trying to see if if there are some changes amendments in the law for doubt for for stable coins for um for financial instruments for anything that you have encountered over the the past um the past weeks the past month through um through your your interaction and in Switzerland and says here we have something that we need to actually attack on because it doesn't work we have to do a whole work around instead

of developing the products we wanted to develop foreign [Music] to a full decentralized um autonomous Organization for instance so yes so besides the stable coin as you mentioned rightfully uh abiba we we looked at the the potential

implementation and the the lack of adaptation that we might find in the Swiss civil code and swiss code of obligation and um so we had uh um in 2023 and a new uh version of the the code Swiss code of obligation entering into Force adapting uh the the the corporate law and mostly adapting it also regard to General Assembly that can now behold virtually and the idea would be to to to know whether you know there would be eventual modification some adaptation within knowing that we can also have the token shares knowing that if you think that we would

need to have a few adaptation in this regard uh and did you um uh why would you have a Dao for example with uh with a utility token and could you have a Dao that worked with your Association what would you do is why won't you do it and uh is like the regulation what are the the challenges that you encounter from a regulatory point of view that's really the point of today's to find out uh if you use the system do you encounter like paramedics except that you know uh you might be Pioneer and you might you know try to find solution no okay so we we found um we found maybe

some uh some a few adaptation here and there especially it was raised that uh potentially the the question of uh having a Dao linked to a corporation was was not really uh um doable under under Swiss law by some of the members thought it was kind of eventually complicated uh some other thought that uh that uh of course as you you all know uh Swiss Association slash Dao um are doable uh but uh we don't see that many to be to be honest so I I've made a few a few of them uh here and there but uh but uh potentially there will be some some modification to be made uh in the Swiss uh code of

obligation that would adapt adapt this if there is not too too many reactions regard to the Swiss private law one of the very important point that we wanted to to discuss uh with you and that came up uh more and more it's actually linked to the Dao is the question of most of the time the dials are actually made them for the purpose of being some kind of a collective investment scheme we kind of all know it uh it's kind of a a very pragmatic point because the collective investment scheme act under Swiss law is very very how can I put that gently uh I don't have the word but it's it's kind of complicated

it's yeah you need to have a lot of money because it has a lot of and it hasn't changed maybe for for that much time we there is this uh this recent uh adaptation with regard to elkief qualified investor which was not really groundbreaking and which didn't really change anything in the game and we would like to actually propose to the sieve to revise in the The Lex dlt2 the new framework would like to to ask the the shift to eventually revised the collective investment scheme act to eventually take into account the new models and the models especially targeting the retails so we're not all in for the retails but it makes it would make some sense to have uh Collective investment scheme that would be possible

especially whenever the the collective investment scheme is a you know below a certain threshold um one of the issue that we directly encounter is the the this um if we we would have a low like this in Switzerland it would be paramedic with regard to eulo and with regard to to eventually other directive Etc but in this uh in this uh this discussion of finding a hedge of being the crypto nation and making sure that also that you know the functional use case have a legal existence because you know we kind of open we're opening a small door but we're making sure that the whole system is kind of fairer by the end of the day we wanted to propose

something uh that would kind of enable Dao for the purpose of being a collective investment scheme being kind of implemented it to the corrective investment scheme act which will enable uh under a set of condition to kind of have Dao that would also uh Target retails that would be possible under a light regime let's say on the Swiss law any reaction to that quite a game changer yeah yeah so overall this notion of of creating more sandbox was also discussed

recently in the EU so do you uh you published uh very recently uh the a smaller a smaller news that uh there would be uh there would be more sandbox dedicated to to blockchain uh I'll post it uh probably I'll ask someone from the CVA to post it uh in the in the coming days but we can see that there is a some kind of a solution coming up to Regulators uh when I want to be kind of friendly towards crypto to create those kind of special uh uh you know uh threshold Zone within their regulation to say okay before a

certain threshold this does not apply then the whole point of the game is to make this threshold interesting enough for a stakeholder to to to create a viable business model um because we saw that for example with the sandbox license under 1 million of custody in Swiss law so and this was understood slow you can hold up to 1 million in custody before uh needing to to actually request the fintech license which would be the the the the license just before a banking license uh but we haven't seen much much uh traction really uh from there um because you cannot do much of a business model

if you you can only hold in your account 1 million can be practical but not really a game changer so next point that we wanted to discuss was the question of tax I believe tax can be can be uh so it can be kind of something that attracts people we we also uh the the traction that gained in the in the in the recent years places like Dubai with very interesting uh tax uh tax rates uh in this sense we wanted to eventually uh hinge to the the legislature that having eventually a tax

break could be could be interesting not necessarily a tax break that would directly result in changes in the law but who were thinking of of bringing forward this idea of tax being an important game changer for people to from from a foreign investor or from abroad coming in Switzerland considering also that Switzerland is also very um costly for anyone willing to create a project uh the question of having a tax break if it can help us get the the best uh entrepreneurs on the planet would make a lot of sense

who who wants a tax break raise your hand any any any thought on that do you have any any thought on that please take uh take the floor I think it's um it's always a question um quite political and I'm not sure whether it would fly actually and Switzerland being quite um quite careful when it comes to tax with the with the with his uh its history to at least actually would what would be interesting is looking at what the different Contours are doing and see if

there is some some kind of of improvement but that's not coming from the Federation from the Confederation from from the from the Federal that the Africa diet but but at least this could be also something interesting in terms of coordination between the controls I've recently done a um uh for foundation uh comparison between uh civil culture for the setup of the foundation for the capital gain for um the first incomes and it's really different from one control to the others

there are there are of course rules uh Federal Federal rules in terms of tax but the the the the the tax that is the heaviest are actually um uh communal at the city level and at the control level uh I I cannot agree more I I believe there is also um we can change anything in the law in the end most of it's it's uh most of the time a lot of the the weight on all those questions relies on the administration and for example the a concrete example that comes to to mind for me uh was this question of whether the the creation of of an nft that would also uh constitute a work of art would

be actually free of vat because under the vat law you have for example an exemption for art uh that that applies and uh we can see in this concrete example that most of the time the administration willingly do not want to apply this exception you know to crypto uh and for reasons that are kind of uh you know political and that kind of rely on a few people on uh in in some places so I saw also that regard to to uh to the gaming law uh an interesting exception exists at the beginning of this uh the gaming Law act under Swiss law uh that was actually revised also a few years ago without much uh

without much success so let's say or groundbreaking changes um and um and um having a discussion with the with the person from the federal Administration they simply did not wanted to actually apply this exception to crypto even though it would have applied to any other uh stakeholder that would be a retail internet Merchant uh uh in Switzerland so sometimes you know the the key Point here is to say that uh of course we can change the law but it could be also problematic uh if it does not follow or if the administration itself is not open to that um

we have five to ten more minutes left we discussed the main point that we want to to present for now to to deceive so we'll uh we'll hand out a report and this report will be also public uh to the series for for the the CVA members um don't uh don't hesitate uh as I was mentioning in the beginning of the call to send over your IDs or the the groundbreaking change that you want to see happen in Switzerland uh or the the challenges that you really fund whenever you were evolving in this Swiss blockchain ecosystem

because this will really uh try and uh Inspire us to for The Regulators to to actually tell The Regulators what should be uh should be done to create the most favorable ecosystem here so having said that I'll leave you an opportunity to to uh to discuss a topic of your choice it's the miscellaneous part anyone willing to to discuss a topic or or give its opinion is free to do so now thank you Ralph yeah I just didn't want to monopolize uh

the floor too much uh after my first night very welcome um yeah I think uh the state of the coin um is a matter of trust um since the deepeg of Terror Luna um it has I problem being trusted so that's why so far it's the one-to-one ratio which is the medicine again the Cure against the disease of of the trust gone with the Terra Luna Deepak

so um but it was the case even before by the way yeah yeah but even more since the Terra Luna Deepak um I would guess that the general public you know we always need to remind ourselves that we are just a tiny group um and the General Public has an opinion on crypto without even holding one and the regulator has to pass regulation through the normal political system

which is very close to the average opinion uh and not the specialist's opinion so that's probably um the that's why your Association is so valuable um to educate the general public to raise awareness to raise uh knowledge level levels so that um then as in Switzerland there's never ever regulation which is unilaterally issued by the regulator there's always everyone can participate at least have a say on it so

um there's no regulation just coming from the Lego regulator top down boom that's it it'll always be a participation involved and and um thank you for that that's a very valuable contribution to our economy and have a we we all wanted it to um proceed quicker after the DLT act came into force of course um uh maybe one way to have some more traction on the ground is to think of non-financial DLT applic use cases and

applications um that's that that would be that if if people for example could have their um ID well you know shameful case the most shameful case for Switzerland as a whole is the lack of an electronic ID so we need to sort it out first and then we need to move on with the uh qualified electronic signature and and then uh people can really get um used to use um crypto and and but as long as the foundation for it is lacking um maybe that would also be a useful

um footnote in one of your next answers to uh zif or finma that yeah we also need to have an eye on non-financial use cases of the DLT absolutely and I I believe I believe uh this is a this is a key point so you you have what you say in essence uh if I may a little bit uh quote uh summary is really this very important point to say that it's actually a multi-domain type of problematic we need the identity we need the financial we law we need to have uh to have things going on well on multiple domains and um and I definitely agree so the the Swiss approach with regard to

all those non-financial uh um uh DLT use case it's really to say that people are able to actually to actually create utility token to have a utility service and the finma said that whenever you create a ug token for a minimal for a product it exists Etc basically you fall under Swiss code of obligation and they don't need to regulate and that's also one of the the point that was made by Bieber uh indirectly at the beginning is that the current uh person defining the crypto be it in Switzerland or abroad is actually the financial regulator by saying negatively you know what is a

financial uh what is a financial securities or financial instruments and what is not and what is not going to fall outside and they have this this great jurisdiction in do so so whenever we look at the competence of the fin mode or the Venture regulator we can see that it actually stops at this non-financial use case that's why we don't have any we don't have much but I definitely agree with you um the the use cases most of the use cases especially when we believe in blockchain as a you know an instrument for the retail will be found in these non-financial use cases where we have authorities like the sicko that have not been very active you know in the in the

in the blockchain industry for first to say the least but this will be also eventually a time for for them to to to wake up and actually from a Swiss regulatory point of view as the financial stakeholder are not active it's our role as part of the doctrine part of the lawyer to actually create uh best practice in the legal system within the the contractual law that is kind of up to the decision of the party so it's it's our role to actually build it up and make sure that it's distinct from the financial law for your participation

uh be by if you do you want do you want to say a few ending world uh in the world for for this session thank you very much guys I think uh uh we we had uh also uh bilateral interactions uh we're with some of you as well um we'll coordinate what has been done uh in the past with Steve already at the CBA level so we can also bring forward what has been uh mentioned in terms of EML and um yeah happy to to receive your your position including your other one uh I think you have you have quite a good understanding that would be very useful as well for for developing the the shoes Market

oh thank you very much um I I've just um finished a master's thesis on in in German um I'll try to translate it into English ASAP I'm speaking we speak German so that's and then and then put it put it out on on LinkedIn um it's it's the use case that I mentioned before that we should consider to um publish um Authority decision as nfts on the blockchain be it be it the drivers be the driver's license or you know a a car document

so you don't need to go through all your um glass department when you hit a police checkpoint so you have it on your wallet you just show it to the police officer and you you go you go through very interesting very interesting and I believe that's uh that's uh in the sourcing of the future yeah I'm pretty I'm pretty sure you look at the eventually storage uh decentralized database project that deals also with that uh for for now but maybe that's uh that's a topic that's another one exactly and another one that I will be delighted to to read it but it's a torch yeah yeah we have a terrible accent thank you

uh it's a pleasure hosting hosting this this panel with you thanks a lot to everyone for your time and uh we'll we'll be uh waiting for your uh your um your console to actually give the the best uh the best advice to this if to have the greatest regulatory framework have a good evening everyone have a good evening thank you very much looking forward