NFTs in Switzerland: Legal Treatment, FINMA Classification, and the Swiss NFT Market

NFTs in Switzerland: Legal Treatment, FINMA Classification, and the Swiss NFT Market

The non-fungible token created, over the course of roughly 2021, an entirely new market for digital art and collectibles — and, in the process, raised a series of legal questions that no jurisdiction had previously needed to resolve. What does it mean to “own” a digital image? What rights does NFT ownership confer under copyright law? When does an NFT become a security? How is NFT income taxed?

Switzerland, with its sophisticated IP law tradition, its FINMA regulatory framework, and its status as home to the Tezos Foundation — one of the most significant NFT-supporting blockchain foundations — has engaged with these questions with greater seriousness than most jurisdictions. The answers are not always comfortable for NFT market participants, but they are clearer than the answers available in most other countries.

What Is an NFT?

A non-fungible token is a unique, blockchain-based digital asset identified by a token ID within a smart contract. Unlike fungible tokens — where each unit is interchangeable with every other (one ETH equals one ETH) — each NFT is unique: the token ID is distinct, the associated metadata points to a specific digital file or set of attributes, and transfers are recorded permanently on the blockchain.

NFTs are created (“minted”) by deploying a smart contract that implements a non-fungibility standard — ERC-721 on Ethereum, FA2 on Tezos, or equivalent standards on other chains. When a creator mints an NFT, they deploy or call a contract that registers a new token ID and associates it with metadata: typically a JSON file containing a description, attributes, and a link to the underlying digital file (image, video, audio, or other content).

The metadata link is technically critical and frequently misunderstood. In most NFT implementations, the digital file itself is not stored on the blockchain — storing large files on-chain is prohibitively expensive. Instead, the metadata contains a URL pointing to the file, hosted either on a centralised server (fragile: if the server goes down, the NFT’s associated image disappears) or on a decentralised storage system such as IPFS or Arweave (more durable: content-addressed storage makes the file retrievable as long as it is pinned by any node in the network).

The quality of an NFT’s storage architecture is a significant factor in its long-term value. High-value art NFTs (such as those from Art Blocks on Ethereum or fxhash on Tezos) often store the generative art algorithm fully on-chain, ensuring the artwork is permanently available regardless of external infrastructure.

NFTs in Swiss Law: The Core Legal Distinction

The most important legal concept for understanding NFTs under Swiss law is the distinction between the token and the underlying intellectual property — and the fact that these are separate, independently transferable rights.

Ownership of the Token vs. Ownership of the Copyright

Under Swiss copyright law (the Federal Act on Copyright and Related Rights, URG), copyright in a creative work vests automatically in the author at the moment of creation. Unlike some other forms of intellectual property, copyright does not require registration.

When an NFT is minted and sold, the seller transfers ownership of the token — the on-chain record of a unique digital asset. The seller does not automatically transfer copyright in the underlying digital work. Copyright transfer under Swiss law requires an explicit written agreement (URG Art. 16). The standard practice in most NFT markets — minting an NFT and selling it through a marketplace without explicit copyright documentation — does not transfer copyright.

This distinction has significant practical implications. The buyer of an NFT for CHF 50,000 typically receives:

• The NFT token (the on-chain record);
• The right to display the associated image for personal use;
• Whatever specific rights the NFT’s smart contract and accompanying terms explicitly grant.

The buyer typically does not receive:

• The right to reproduce the image commercially;
• The right to create derivative works;
• The right to license the image to third parties;
• Any other copyright rights not explicitly granted.

Sophisticated NFT projects address this through explicit licence agreements. Yuga Labs (creator of Bored Ape Yacht Club) originally granted BAYC holders commercial rights to their specific ape image — an unusual and commercially significant grant that contributed to the collection’s value. But this grant was contractual, not inherent to the NFT itself.

Swiss lawyers advising on NFT transactions routinely recommend explicitly documenting what intellectual property rights, if any, are being transferred or licensed alongside the token — a step that most retail NFT market participants currently skip.

FINMA’s Classification Framework Applied to NFTs

FINMA’s 2018 guidance on initial coin offerings established a three-category token taxonomy that has been applied to NFTs:

Payment Tokens: Tokens used primarily as means of payment. Most NFTs are clearly not payment tokens.

Utility Tokens: Tokens that provide access to a digital application or service, or that represent a form of membership or access right. FINMA treats most NFTs as utility tokens — they represent ownership of a unique digital asset or access to an associated community/ecosystem.

Asset Tokens: Tokens that represent a claim on underlying assets (real-world assets, cash flows, profits), effectively functioning as securities. NFTs that embed economic rights — profit-sharing rights, royalty entitlements, investment returns — risk classification as asset tokens, which would subject them to FINMA’s capital markets regulations including prospectus requirements and potential licensing obligations.

The practical consequence: a standard digital art NFT (image, collectible) is a utility token and is not subject to securities regulation. An NFT representing a fractional interest in a fund, a revenue share in a project, or a dividend-like entitlement would likely be an asset token and therefore a security. The line can be blurry in practice — NFT projects that promise future benefits, project ownership stakes, or revenue participation frequently cross from utility into asset token territory without recognising the regulatory implications.

FINMA has not published NFT-specific guidance as of early 2026, but its general token classification principles, applied by Swiss practitioners to NFTs, provide sufficient clarity for well-structured projects.

The Swiss NFT Art Market

Switzerland has a well-developed contemporary art market centred on Basel (Art Basel) and Zurich, with significant collector bases. The NFT art market has engaged this existing ecosystem in several ways:

SwissArtExpo and Digital Art Integration

Swiss art exhibition events have increasingly integrated NFT art. SwissArtExpo — one of Switzerland’s largest international art fairs — has hosted digital art and NFT exhibitions, bringing NFT art into contact with traditional art market participants, collectors, and institutional buyers. This cross-pollination of the traditional and NFT art worlds is more advanced in Switzerland than in most comparable markets.

Foundation Platform

Foundation (foundation.app) — a decentralised art marketplace built on Ethereum — has attracted Swiss-based artists and collectors. Foundation operates through curated creator communities, with artworks sold as ERC-721 NFTs. The platform’s emphasis on artist curation (access requires invitation from an existing creator) has maintained quality standards that distinguish it from lower-barrier NFT markets.

Tezos and the Generative Art NFT Ecosystem

The Tezos Foundation, headquartered in Zug, has made the Tezos blockchain a leading platform for generative art NFTs — creating a significant connection between Crypto Valley and the NFT art market.

Why Tezos for NFT Art?

Tezos has several properties that made it attractive for the NFT art community:

• Low transaction costs: Tezos operations (“transactions” in Tezos terminology) cost a fraction of Ethereum mainnet gas, making minting and trading affordable for artists and collectors working with modest price points.
• Proof of Stake energy efficiency: Tezos has used Proof of Stake since its genesis, enabling the network to market itself as environmentally responsible at a time when Ethereum’s Proof of Work energy consumption was a significant criticism of NFT markets.
• On-chain governance: Tezos’ self-amendment protocol (upgrades are voted on by bakers — Tezos validators — and automatically activated without hard forks) provides stability reassuring to artists and collectors building long-term digital provenance.

objkt.com

objkt.com is the largest NFT marketplace on Tezos, functioning as the Tezos equivalent of OpenSea. It hosts hundreds of thousands of NFT artworks and is the primary secondary market for Tezos NFTs.

fxhash

fxhash is the most significant generative art platform on Tezos and one of the most important generative art platforms in Web3. Generative art NFTs are created through algorithms: an artist writes code that, when executed with a random seed (derived from the transaction hash at mint time), generates a unique artwork. Each mint produces a different output from the same algorithm — creating a limited edition of algorithmically unique works.

fxhash democratised generative art NFT minting by enabling artists to deploy their algorithms and sell open or limited editions without curation requirements. It has become a significant venue for algorithmic artists, with notable works from Swiss and international artists selling through the platform.

The Tezos Foundation’s Zug domicile gives Switzerland direct institutional exposure to this ecosystem — the Foundation funds Tezos ecosystem development, supports NFT platform grants, and engages with Swiss regulators on Tezos-related matters.

NFT Gaming and In-Game Assets

Switzerland hosts several blockchain gaming projects that use NFTs to represent in-game assets — items, characters, land parcels, and other elements that players own on-chain rather than in a game publisher’s database.

The distinction matters economically: in traditional gaming, in-game assets are licensed (not owned) by players, exist in a publisher-controlled database, and can be revoked or devalued by publisher decisions. NFT-based in-game assets exist on the blockchain — tradeable in open markets, portable across compatible platforms, and not subject to unilateral publisher modification.

The Swiss Web3 gaming ecosystem includes projects built on Ethereum mainnet, Ethereum L2 networks, and Polkadot parachains. The development of ERC-6551 (Token Bound Accounts) — an Ethereum standard enabling NFTs to own assets themselves, including other NFTs and fungible tokens — has enabled more sophisticated in-game NFT economies where a character NFT can accumulate equipment, currency, and achievements.

Tax Treatment of NFTs in Switzerland

The Swiss Federal Tax Administration (ESTV) has published guidance on the tax treatment of cryptocurrency activities that applies, by analogy, to NFT transactions. Key principles:

Private Investors: Capital gains on assets held as part of private wealth (Privatvermögen) are generally tax-free in Switzerland for private individuals, provided the activity does not constitute professional trading. This principle extends to NFT disposals: an individual who buys and sells NFTs as a private investor, without the characteristics of a professional trader (leverage, frequency, systematic approach), may realise gains tax-free under Swiss federal and cantonal income tax.

Professional Trading: Individuals who trade NFTs with the characteristics of professional trading — short holding periods, high frequency, leverage, systematic approach, or where NFT income constitutes a significant portion of total income — are subject to income tax on NFT trading profits.

NFT Creation (Artists): Artists who mint and sell NFTs are subject to income tax on the proceeds, as this constitutes professional self-employment income. Ongoing royalty payments received through smart contract mechanics are likewise taxable income.

VAT: The VAT treatment of NFTs is uncertain. Standard art sales are generally subject to Swiss VAT at the reduced rate (2.6% for art). Whether NFTs constitute “art” for VAT purposes, and what place-of-supply rules apply to digital asset transactions, are areas of ongoing uncertainty that ESTV has not definitively resolved.

Luxury Goods NFTs: Switzerland’s Watch Industry

Switzerland’s watch industry — representing brands including Rolex, Patek Philippe, Breitling, TAG Heuer, and dozens of others — has engaged with NFT technology primarily around provenance and authenticity.

The concept is straightforward: a watch manufacturer could issue an NFT at the time of manufacture, recording the watch’s serial number, specifications, and provenance on the blockchain. The NFT travels with the watch through its ownership history, recording service events, transfers, and authentication. This creates an immutable, publicly verifiable provenance record that supplements (or in some implementations replaces) traditional paper certificates.

Several Swiss luxury brands have piloted NFT provenance systems. The Watch and Jewellery Initiative of Switzerland (WIJS) — an industry consortium — has explored blockchain-based authentication standards. TAG Heuer has developed NFT integration for limited edition watches. Breitling has issued digital certificates as NFTs.

The practical adoption challenges are significant: legacy watch inventory lacks NFT-based provenance, luxury buyers are not necessarily comfortable with blockchain interactions, and secondary market infrastructure for luxury NFT provenance is nascent. But Switzerland’s combination of luxury goods industry depth and Crypto Valley infrastructure makes it a natural laboratory for these applications — and the FINMA regulatory framework provides clearer guidance on how luxury provenance NFTs would be classified (utility tokens, in virtually all such implementations) than most alternative jurisdictions.

Related Coverage

• NFT Markets in 2025: What Survived the Crash and What Switzerland’s Collectors Are Buying
• Ethereum: The Web3 Foundation and Zug’s Protocol Anchor
• Web3 Regulation in Switzerland: FINMA, the DLT Act, and MiCA Interaction
• Web3: Definition, History, and the Decentralised Internet Vision
• Polkadot: Zug’s Interoperability Protocol and the Web3 Relay Chain

Author: Donovan Vanderbilt | The Vanderbilt Portfolio AG, Zurich Published: 24 February 2026