FINMA Securities Dealer Licence: Requirements and Digital Asset Applications

Switzerland’s regulatory framework for financial services underwent a fundamental reform when the Financial Institutions Act (FinIA) and Financial Services Act (FinSA) came into force on 1 January 2020. This reform consolidated and modernised the Swiss framework for authorising financial intermediaries — and in doing so, created the current licensing architecture within which Switzerland’s digital asset trading industry operates.

The securities dealer licence is the workhorse of Swiss digital asset regulation. It is more demanding than SRO membership, more attainable than a banking licence, and — crucially — it grants the broadest set of trading permissions available to a non-bank financial institution in Switzerland. For digital asset businesses that trade securities (including DLT securities), execute client orders, or provide custody services, the securities dealer licence is the natural target authorisation.

Legal Basis: FinIA and FinSA

The Financial Institutions Act (Finanzinstitutsgesetz, FinIA) is the primary statute governing the authorisation of financial institutions in Switzerland. It establishes the licensing requirements for portfolio managers, trustees, fund management companies, securities dealers, and banks — creating a structured hierarchy of authorisations calibrated to the activities performed and risks posed by each type of institution.

The Financial Services Act (Finanzdienstleistungsgesetz, FinSA) is the companion statute governing how licensed financial service providers interact with clients — requiring them to meet client classification requirements, provide point-of-sale documentation, and handle conflicts of interest appropriately.

Together, FinIA and FinSA replaced a fragmented prior regime that had developed piecemeal over decades. The previous framework had treated securities dealers under the Stock Exchange Act — a law designed for traditional securities markets that applied awkwardly to digital asset businesses. FinIA’s more principles-based approach has proven more adaptable to digital asset activities.

FINMA published detailed guidance in 2019 (updated subsequently) clarifying how it applies existing financial market law to digital assets, including which activities constitute regulated securities dealing and what licensing is required.

What the Securities Dealer Licence Permits

A FINMA securities dealer licence (in German: Effektenhändler) authorises the holder to conduct the following activities on a professional basis:

Trading for own account as main business: Securities dealers may trade in securities and other financial instruments for their own account as a principal activity — acting as market makers, proprietary traders, or as the principal counterparty in OTC transactions with clients.

Client securities trading: Securities dealers may execute transactions in securities on behalf of clients — acting as broker-dealer, routing and executing orders on exchange or OTC, and delivering execution reports.

Underwriting: Securities dealers may underwrite securities issuances — purchasing securities from issuers and distributing them to investors.

Custody services: Securities dealers may hold financial instruments (including DLT securities and digital assets classified as securities) in custody for clients, subject to the segregation requirements of FinIA.

DLT securities trading: Under the DLT Act, securities dealers may trade DLT-based securities (tokenised bonds, equities, and other instruments) as they would conventional securities, including on DLT trading facilities such as SDX.

What the Licence Does Not Cover

It is equally important to understand what a securities dealer licence does not authorise:

Deposit-taking: Securities dealers may not accept public deposits. Taking deposits from the public requires a banking licence under the Banking Act. This distinction is fundamental — Bitcoin Suisse, which holds a securities dealer licence but not a banking licence, cannot accept client fiat deposits in the manner a bank does.

Fund management: Managing collective investment schemes (mutual funds, hedge funds, private equity funds) requires separate FINMA authorisation as a fund management company or AIFM.

Insurance activities: Insurance and reinsurance require separate FINMA authorisation under the Insurance Supervision Act.

Unlimited custody of client fiat: While a securities dealer can hold client assets in custody, the scale and manner of that custody is different from a bank. Securities dealers typically hold client assets in nominee/custody structures rather than as general deposit liabilities.

Capital Requirements

FinIA establishes minimum capital requirements for securities dealers that scale with the complexity and risk of the business:

Minimum capital threshold: CHF 1.5 million for smaller securities dealers that do not hold client assets or act as market makers in systemically relevant volumes.

Higher capital tiers: Systemically more complex dealers — those acting as market makers, managing large client portfolios, or engaging in significant proprietary trading — are subject to higher capital requirements calibrated by FINMA to the risk profile of their specific activities.

Capital form: Required capital must be in the form of paid-up equity capital (Eigenkapital). FINMA requires capital adequacy to be maintained on an ongoing basis — it is not simply an initial licence fee.

Liquidity requirements: Securities dealers are subject to liquidity requirements ensuring they maintain sufficient liquid assets to meet their obligations. FINMA may impose additional buffer requirements based on its supervisory assessment.

For context, the CHF 1.5 million minimum compares to the CHF 10 million minimum for a banking licence — reflecting the different risk profile of a securities dealer that does not take deposits versus a bank that holds public deposits at scale.

Fit and Proper Requirements

Beyond capital, FinIA requires that the individuals managing and controlling a licensed securities dealer meet FINMA’s “fit and proper” standards. These requirements apply to:

Senior management (Geschäftsleitung): Members of the management board must demonstrate relevant professional qualifications, experience in financial services, and personal integrity. FINMA assesses qualifications through curriculum vitae review, reference checks, and in some cases direct interviews.

Board of directors: Board members (Verwaltungsrat) must also meet fitness standards, including independence requirements for supervisory board members.

Significant shareholders: Individuals or entities holding qualifying participations (typically 10% or more of voting rights or capital) are subject to FINMA approval. FINMA assesses whether significant shareholders have the financial soundness and business reputation required for their influence over a licensed institution.

Ongoing obligations: Fit and proper assessments are not one-time events. Material changes to senior management or significant shareholders require FINMA notification and, in some cases, approval.

Annual Audit Requirement

Every FINMA-licensed securities dealer must engage a FINMA-recognised audit firm (Prüfgesellschaft) to conduct an annual audit. This is not a standard financial statement audit — it is a regulatory audit covering the firm’s compliance with FinIA requirements, capital adequacy, client asset segregation, and internal controls.

The audit report is submitted to FINMA and forms the primary basis for FINMA’s ongoing supervisory assessment of the dealer’s compliance. FINMA may follow up on audit findings with direct supervisory enquiries, on-site inspections, or remediation requirements.

The annual audit obligation is a significant operational cost for smaller securities dealers but is non-negotiable. It provides the institutional infrastructure through which FINMA exercises ongoing supervision across its thousands of licensed entities without direct examination of every firm annually.

Digital Asset Businesses Holding Securities Dealer Licences

Bitcoin Suisse AG

Bitcoin Suisse was among the first Swiss crypto businesses to obtain a FINMA securities dealer licence, having operated under VQF SRO oversight before graduating to direct FINMA authorisation. Its securities dealer licence permits Bitcoin Suisse to trade digital assets classified as securities (including DLT securities), execute spot trades for clients in Bitcoin, Ethereum, and other assets, and provide custody services for digital asset holdings.

Bitcoin Suisse’s licence was obtained through a process that required demonstrating to FINMA that its business model, compliance infrastructure, AML systems, and capital base met the FinIA standard — a multi-year process that involved significant investment in regulatory compliance.

Sygnum Bank AG

Sygnum holds both a banking licence and a securities dealer licence — the most comprehensive regulatory stack available to a Swiss financial institution. Sygnum’s securities dealer authorisation complements its banking licence by explicitly authorising its trading and execution services for clients.

AMINA Bank AG (formerly SEBA)

AMINA Bank, like Sygnum, holds both banking and securities dealer licences. Both banks were granted their dual authorisations simultaneously in 2019 — FINMA’s landmark decision recognising that digital assets had matured to the point where a full-service regulated digital asset bank was appropriate for the Swiss market.

Alternative Regulatory Pathways

The securities dealer licence is not the only route for digital asset businesses operating in Switzerland.

VQF SRO Membership

The most common regulatory framework for Swiss digital asset businesses is membership in a FINMA-recognised self-regulatory organisation, primarily VQF. VQF membership is required for financial intermediaries subject to the Anti-Money Laundering Act — businesses that conduct money changing, virtual currency exchange, or payment transmission services.

VQF SRO membership provides compliance with Swiss AML/CFT obligations but does not grant securities trading permissions. Many hundreds of Swiss crypto businesses — from smaller brokers to payment processors, ATM operators, and DeFi-adjacent services — operate under VQF oversight without a direct FINMA licence.

VQF SRO membership is appropriate for businesses whose activities do not constitute professional securities trading. The moment a crypto business begins executing securities transactions for clients at professional scale, a securities dealer licence becomes necessary.

Banking Licence

A banking licence provides the most comprehensive authorisation — and the most demanding requirements. For digital asset businesses, a banking licence adds deposit-taking capacity, access to the Swiss National Bank’s payment systems, and the full weight of Swiss banking supervision, including SNB repo access and esisuisse depositor protection scheme membership.

The two digital asset banks — Sygnum and AMINA — hold banking licences because their institutional clients require deposit-taking capability and the counterparty safety that comes with full banking supervision.

Fintech Licence

The fintech licence (introduced in 2019) permits deposit-taking up to CHF 100 million and limited financial services without a full banking licence. It was designed to allow fintech startups to test deposit-funded business models without the full overhead of banking supervision.

For digital asset trading businesses, the CHF 100 million deposit cap makes the fintech licence unsuitable as a long-term regulatory home for any firm operating at scale. It remains a useful pathway for early-stage firms testing deposit-funded models before scaling to full banking licence requirements.

Practical Considerations for Digital Asset Businesses Seeking a Licence

Obtaining a FINMA securities dealer licence is a substantial undertaking. The process typically takes 12–24 months from initial application submission to licence grant, and involves:

• Drafting detailed business plan documentation meeting FINMA’s disclosure requirements
• Demonstrating adequate capital above the statutory minimum
• Obtaining FINMA approval for senior management and significant shareholders
• Establishing compliance and AML/CFT infrastructure meeting FINMA’s standards
• Engaging a FINMA-recognised audit firm
• Building legal documentation for client relationships meeting FinSA requirements

The process requires experienced Swiss financial regulatory counsel and typically involves significant engagement with FINMA through formal and informal dialogue before the formal application is submitted.

For digital asset businesses considering Switzerland as a regulatory home, the securities dealer licence represents the most accessible path to a direct FINMA authorisation — more attainable than a banking licence, more respected than SRO membership alone, and the credential that Swiss institutional clients, banks, and counterparties regard as the threshold of regulatory credibility.

Related Coverage

• VQF SRO Membership for Swiss Crypto Businesses: The Alternative to a Full FINMA Licence
• Bitcoin Suisse: Zug’s Pioneer Crypto Broker and Switzerland’s First Digital Asset Firm
• Switzerland’s Digital Asset Exchange Landscape: FINMA Licensing and Market Structure
• Crypto Derivatives Trading in Switzerland: Futures, Options, and the FINMA Regulatory Framework

Donovan Vanderbilt is the founder of The Vanderbilt Portfolio AG, Zurich. ZUG TRADING does not provide investment advice. This article is for informational purposes only.