Fintech in Switzerland: 2018 Mid-Year Reviewby Fintechnews Switzerland July 13, 2018
The Swiss fintech industry has been growing steadily in the past years, supported by superior general conditions for fintech companies including the political stability and the progressive regulatory environment.
As of early July 2018, Switzerland counted 264 fintech startups, 14 more than in June. But one segment in particular that’s been thriving in Switzerland is blockchain and cryptocurrency which the country set out to become a leader in.
Among the key developments in the Swiss fintech industry, here are the highlights of the first half of 2018:
A “crypto nation”
Switzerland has become a hotbed for cryptocurrency and blockchain, and in many aspects, is now one of the world leaders in initial coin offerings (ICOs). So far this year, Swiss ICOs have raised US$507 million through 48 campaigns, according to a recent report by the Crypto Valley Association and PwC.
Johann Schneider-Ammann, economics minister even said in January that Switzerland wanted “to be the crypto nation.” The statement preceded the release of ICO guidelines in February by the Swiss Financial Market Supervisory Authority (FINMA) which detail the legal requirements for companies in Switzerland looking to issue and sell crypto tokens.
SIX to launch digital asset trading platform
SIX, the operator of Switzerland’s principal stock exchange, announced earlier this month plans to launch a trading platform for digital assets including cryptocurrencies, becoming one of the first established financial services providers in the world to offer a regulated trading platform for crypto tokens and assets.
Called SIX Digital Exchange, the blockchain-based platform will allow for the issuance, trading, settlement and custody of digital assets. The first services will be rolled out in the first half of 2019.
Crypto Fund granted license
In June, FINMA granted a license to a cryptocurrency fund provider. Crypto Fund, a subsidiary of by Zug-based company Crypto Finance, has been allowed to distribute collective investment schemes to qualified investors.
Crypto Fund said it was also seeking approval for a passive investment vehicle tracking a benchmarked index of up to 10 of the largest and most liquid cryptocurrency assets and tokens, as calculated and maintained by Swiss bourse SIX.
Crypto Valley trial blockchain voting
Switzerland’s Crypto Valley, the city of Zug, completed its first blockchain-based municipal vote on July 2, 2018. The trial was deemed a “success” by local officials.
The vote was held using a trial digital ID system announced in June. City authorities, who have issued digital identities to residents since 2017, are currently evaluating different applications of blockchain technology for governance.
Japan’s Financial Services Agency (FSA) and FINMA exchanged letters for cooperation on fintech in April. The agreement between the two aims to facilitate collaboration between FSA and FINMA on information sharing, fintech developments, regulatory issues, and help both regulators expand their respective fintech networks.
Switzerland also signed three Memorandums of Understanding (MoU) with Hong Kong in January. These agreements focus on enhancing fintech collaboration, and promoting the development of private wealth management in Switzerland and Hong Kong, among other goals.
Credit Suisse commits CHF 30 million to Swiss fintech
In March, Credit Suisse injected an additional CHF 30 million into its SVC unit. SVC was set up by the bank in 2010 to provide venture capital to Swiss businesses. So far, SVC has pumped around CHF 110 million into 44 companies from various industries but now Credit Suisse wants to focus on fintech.
The CHF 30 million will go toward firms developing and commercializing digital innovations in finance. Investments will be made by a special fintech committee and will go to companies that are either domiciled in Switzerland or have a clear connection with the country.
New innovation lab
Generali Switzerland, the Swiss unit of the Italian insurer, opened an Innovation Garage in April at its country headquarters in Adliswil.
The new lab seeks to bring together insurance specialists and external partners to work on improving user experience and develop innovative solutions for the digital age. It includes Generali staff, members of the company startup Lings as well as five external startups from the fields of artificial intelligence, crypto security and insurtech. Partners of the innovation lab include fintech accelerator and incubator F10, the University of St. Gallen and companies such as Salesforce.
US investors bails out troubled Swiss blockchain startup Monetas
American company Artillery One took a controlling stake in troubled Swiss fintech startup Monetas, it was unveiled in January. Monetas, a blockchain payments startup, attracted some CHF 11 million from investors before running into severe financial difficulty in 2017.
Daniel Cannon, founder of Artillery One, was appointed co-CEO of Monetas alongside the startup’s founder Johann Gevers.
“We are putting together a strong executive team and welcome all former developers,” Cannon said. “We will be seeking the greatest minds from around the world, to achieve our goals and identify new applications and ventures consistent with the Monetas strategy.”
Featured image: Bern, Switzerland, Max Pixel.