Digital assets and digital currencies
Digital assets and digital currencies on blockchains are becoming increasingly important worldwide. Switzerland is positioning itself as a leading hub for innovation and is actively involved in integrating them into the financial system. The Swiss Bankers Association (SBA), for its part, is lobbying for a reliable operating environment to provide an efficient, secure and future-proof infrastructure for the capital market and payment services, and constructively promote public debate on the opportunities and risks of these developments.
New perspectives for the financial sector and business
Together with digital currencies, digital assets create the foundation for innovative solutions in areas including the capital market, payment services and settlement, and decentralised finance (DeFi). Complementing the existing financial market and payment infrastructure, this opens up opportunities: when money and assets are replicated directly on a shared digital platform, it makes financial sector processes more efficient in the long term, cuts costs and reduces risks. At the same time, digital currencies promise to speed up cross-border payments.
However, introducing them requires substantial investments, standardisation and prudent risk management to overcome new technological and regulatory challenges. The SBA is therefore working to tackle these challenges in blockchain-based financial innovation, and is pooling the resources of banks, fintechs and other actors to harness its potential for the benefit of the Swiss financial centre.
Digital assets: tokenised financial instruments and crypto assets
Digital assets are assets in the form of tokens on a blockchain. They come in various guises, from tokenised financial instruments to what are known as crypto assets.
The first banks worldwide with business models for digital assets were approved in Switzerland back in 2019, underscoring the openness and pro-innovation stance of the Swiss authorities. The first fully regulated digital securities exchange was then given the green light in 2021, followed by the first DLT trading facility in 2025. Increasing numbers of SBA members are also integrating digital assets into their offering. The SBA is following these market developments with great interest, helping to educate politicians and the public at large, and supporting initiatives to standardise and harmonise technological and legal norms.
Tokenised financial instruments are representations of classical financial instruments such as equities, bonds and fund units, on a blockchain. Tokenisation converts ownership of these assets into tradable digital units (asset tokens). These tokens, in conjunction with digital money on a blockchain, can allow for more efficient settlement and lower transaction costs, potentially opening up access to new market segments.
Crypto assets include Bitcoin and Ether. They are digital assets that are created, stored and transferred using blockchain technology, and are recognised as transaction currencies for a range of blockchain ecosystems. In most cases, they are used as highly speculative investment instruments, rarely also as means of payment (payment tokens) or as vouchers for digital services (utility tokens).
Digital currencies are forms of money that exist on a blockchain and are used for transactions in those ecosystems. They can be issued by central intermediaries such as central banks, banks and fintechs, or by decentralised networks.
The SBA is actively involved in discussions on blockchain-based forms of money. It has published a white paper on the deposit token outlining technological, legal and economic concepts for banks to jointly issue commercial bank money on a blockchain. Its expert report on stablecoins analyses the opportunities and risks of stablecoin issuance by banks in Switzerland. A deposit token proof of concept considers the successful implementation of legally enforceable interbank payments using bank deposits via a public blockchain. This is an important step towards a standardised infrastructure for blockchain-based financial services in Switzerland. Such groundwork will also help to encourage the specialist, public and political discourse that is so important in this context.
CBDC stands for “central bank digital currency”, a form of digital money issued and backed by a country’s central bank. It is part of the traditional financial system and is inspired by cryptocurrencies such as Bitcoin and Ethereum but differs in that it is a form of money officially issued by central banks.
Deposit tokens are a blockchain-based form of bank deposits issued by one or more banks. They enable account assets to be transferred between customers of the same bank, but also between authorised external users with accounts at other banks.
Stablecoins are digital tokens whose value is pegged to a reference – a government-issued currency – in order to ensure their stability. Issuers must back them with holdings of high-quality, liquid reserves such as bank deposits or short-term government bonds, which is increasingly being prescribed by the regulators. They serve as a stable digital unit of value that can be transferred and used in DeFi applications without going through intermediaries.
The Swiss financial centre is a leading innovation hub
Switzerland remains a leading hub of innovation in blockchain-based financial solutions. The growing number of regulated financial institutions that are throwing their weight behind blockchain-based financial innovation, along with specialised fintechs, legal and consulting firms underscore the market’s dynamism. Switzerland’s technology-neutral, principles-based regulatory approach has gained worldwide recognition, with a legally secure framework for blockchain-based financial services in place since 2021 that promotes innovation and enables new business models.
However, that advantage cannot be taken for granted. As other financial centres catch up, Switzerland’s framework must continually evolve. The transformation of finance opens up opportunities, but also harbours risks. The SBA is playing a constructive role as that change progresses, addressing issues of market acceptance, value stability and systemic risks, and ensuring that potential is exploited responsibly in the interests of the financial centre.
Digital assets need digital currencies on the same infrastructure. Digital currencies, meanwhile, can be a useful complement to present-day payment services in specific use cases, especially when cross-border scenarios are involved. A clear basis in law, effective supervision of issuers and viable business models will be key. As a leading financial centre, Switzerland must play its full part in shaping those developments.