Author: Matthew Allen, SWI swissinfo.ch

If you could peer into the mind of Sam Bankman-Fried, what would you see? Maybe it doesn’t bear thinking about. In the summer, empire building in Europe, the Middle East and Africa was very much on the mind of the FTX crypto mogul. I’ve already uncovered plans of the FTX crypto group to buy the Swiss NPB Neue Privat Bank, which were frustrated by the financial regulator’s demands. But that was just the tip of the iceberg. According to documents I’ve seen, the Swiss-based FTX Europe was to be housed under a Cypriot holding company (FTX EMEA) that would be armed…

El Salvador has partnered with the Swiss city of Lugano to promote bitcoin adoption. It’s an unlikely partnership and an obscure reason to join forces, but for both parties this is an earnest and worthwhile endeavour. The glue that binds the Central American country with Lugano is Tether, a company that mints stablecoins – digital currencies backed by traditional financial assets, designed to dampen wild fluctuations in value. Tether and El Salvador formed an alliance in 2021 to re-engineer the country’s payments system. In March of this year, Tether and Lugano co-founded the ‘Plan B’ project to encourage shops and consumers to use…

The price of bitcoin has been in freefall in recent weeks, but that doesn’t seem to bother the most conservative of financial institutions – the banking arm of the Swiss post office. PostFinance is stepping up its drive to grant customers access to cryptocurrencies within the next couple of years. Postfinance already offers clients cryptocurrency exposure through its digital app Yuh. This service draws heavily on a collaboration with Swissquote, which became the first Swiss bank to offer crypto trading for retail clients in 2017. But PostFinance now appears poised to go into direct competition with its business partner with an…

Global leaders were treated to a crypto charm offensive at the World Economic Forum in Davos last week. Finance Minister Ueli Maurer and Switzerland Global Enterprise, which is responsible for attracting business, took the opportunity to roll out the red carpet for foreign blockchain companies. Competition for crypto business is intensifying among countries. The United Arab Emirates, for example, is busy handing out financial licenses while Dubai’s free zone has thrown open its doors to footloose crypto firms. The world’s largest crypto exchange, Binance, has been given regulatory approval to operate in France. As I reported in March, Lugano has…

Switzerland is anchoring the European and Middle East expansion of one of the world’s fastest growing cryptocurrency exchanges. The Bermuda-based FTX group is building its regional headquarters on the foundations of a small, yet successful, Swiss company that was established just two years ago. Like many projects I encounter in “Crypto Nation” Switzerland, Digital Assets came together in rapid time, surfing on the rising value of bitcoin. From the office of his law firm in the eastern Swiss canton of Appenzell Outer Rhodes, Patrick Gruhn chanced upon the profitable cryptocurrency advisory business during the bitcoin boom in the middle of the last…

Fresh from re-landscaping El Salvador’s economy, stablecoin company Tether is now giving the southern Swiss city of Lugano a crypto makeover. Tether is helping El Salvador migrate to bitcoin – and it’s now also backing Lugano’s “European Capital of Crypto” ambitions. Lugano’s “Plan B” project is a public-private partnership to attract blockchain start-ups and inspire greater cryptocurrency adoption among companies and citizens. Other Swiss cities, such as Zug, Zurich and Neuchâtel, have successfully built up local blockchain industries. Switzerland now counts well over 1,000 enterprises, employing more than 6,000 people, according to the CV VC Top 50 Report. Lugano has already launched its own blockchain…

The Swiss government is underwhelmed by the performance of the financial technology sector. The finance ministry believes that it’s high time this was remedied. “Unlike the Swiss financial centre, which remains at the top of the global rankings, Switzerland is currently only in the middle of the pack as a fintech hub,” states a recent synopsis of the current situation. “As a leading financial centre and location for innovation, this needs to be remedied. Switzerland needs to build its international visibility and clout.” So how do the administrators aim to boost the number of Swiss fintech “unicorns”? They have commissioned a wide-ranging…

Swiss fintech company Numbrs has blamed jealous banks for killing off its original business model as a third-party provider of financial products. So it has reinvented itself under the banner of the ultimate bank killer – bitcoin. The company, fêted as a rare Swiss fintech unicorn (worth at least CHF1 billion), has just announced it has transformed into a bitcoin storage vault. This is quite a startling strategic shift. More than two million people (mainly in Germany) had downloaded the original Numbrs app. It collected clients’ financial accounts in one place and offered them products from banks. Now all these…

The New Year has started with a sharp fall in the price of bitcoin – and some intriguing stories surrounding the Swiss cryptocurrency scene. The industry is well used to volatility in the price of cryptocurrencies and is ploughing on with expansion plans regardless of how many dollars you can currently get for your bitcoin. New heads at Switzerland’s oldest crypto firm As management shake-ups go, Bitcoin Suisse has raised the bar to a new level. The crypto company’s chairman (and founder) and its CEO have both decided to quit their posts in the space of three weeks. Chief Executive…

The award of a trading license to the SIX Digital Exchange (SDX) coincides with a regulatory backlash on crypto exchanges around the world. For cryptocurrency enthusiasts, the writing is on the wall: the nimble upstarts may have gained a head start but centralised regulators are queuing up to pull them back. Some of these crypto exchanges are blazing a trail into new financial territory – branching out from pure cryptocurrency trading into areas like staking, lending and listing DLT securities, such as blockchain-compliant versions of company shares. This has brought the likes of Coinbase, Binance and Poloniex into conflict with…

The adage “money begets money” is being given a twist in the world of decentralised finance. Here, people can make cryptocurrencies by creating cryptocurrencies. It’s a process called “staking” that promises eye watering interest rates – if you can stomach the inevitable risks that come with it. Cryptocurrencies run on blockchains that rely on their users to validate the transactions that are carried out on them. Transaction validators are rewarded with a batch of freshly minted cryptocurrencies that happen to run on that blockchain. Some blockchains (not bitcoin) require validators to stump up a “stake” of cryptocurrencies as a form…

Sustainable finance is all the rage these days. What better way to market your green credentials directly to the public than through environmentally-sound credit cards? Many sustainable offerings, however, should be viewed under a microscope to test their claims. Most people have them. An estimated six billion credit cards are made every year worldwide. But instead of carrying plastic in your wallet, why not have wood or…wait for it…corn. Zurich Cantonal Bank has teamed up with the company Swiss Wood Solutions to produce an array of biodegradable cards made from sustainable timber. This perfectly taps into the growing demand for…

“We are operationally ready to offer institutional clients bank accounts and payment services in cryptocurrencies, just like Swiss franc accounts.” Gazprombank Switzerland is one of a number of banks hoping that the Swiss regulator will give the green light next year. Gazprombank’s Swiss unit was recently given regulatory approval to store and trade cryptocurrencies on behalf of clients. They join a growing list of such banks in Switzerland. But buying stocks and bonds (or anything else) with bitcoin remains a taboo subject in the traditional banking sector – for now. Edouard Hurstel, Head of Crypto & Blockchain Services at Gazprombank…

The cryptocurrency firm Lykke is one of the longest-established Swiss blockchain companies. But it has recently run into financial difficulties. What’s going on and what does that mean for the sector? Founder and CEO Richard Olsen gave me his take on the situation. First the background. Lykke was established in Switzerland in 2015. It aims to create a decentralised digital market for tokenised assets. This means turning the likes of company shares into digital code that can be traded on the blockchain. It says this will result in faster transactions, lower costs and better access to small investors. But this…

Central Bank Digital Currency (CBDC) is the buzz-phrase of the moment. But the Swiss National Bank (SNB) says producing digital Swiss francs for the general public would create many problems with unclear benefits. The Swiss government has backed up the central bank word for word. And it turns out that an SNB issued digital Swiss franc for institutional players (such as banks) is not a done deal either. “We are conducting cutting-edge research in this area but there are no plans to issue a wholesale CBDC at this time,” says the SNB’s Head of Banking Operations Sébastien Kraenzlin. “Central banks…

The Swiss blockchain industry appears to be in rude health despite the economic fallout of the coronavirus pandemic. The number of new companies and jobs produced by the sector increased in the first six months of the year. Is this trend set to last? The number of Crypto Nation (including Liechtenstein) blockchain ventures expanded from 842 at the end of 2019 to 919 in the second half of this year, according to a biannual industry survey. The number of people they hire also increased – from 4,400 to nearly 4,800. There has also been no shortage of private equity funding…

Cybercrime is a growing menace, affecting one in seven people in Switzerland. Reported attacks have risen threefold since the onset of coronavirus. The Swiss National Cyber Security Centre, officially born this month, has its work cut out even with the imminent arrival of 20 new staffing reinforcements. Universities and the private sector are also playing their part to secure digital infrastructure. The Trust Valley network is a public-private initiative, co-ordinated by the cantons of Geneva and Vaud along with several universities, including the Swiss Federal Institute of Technology Lausanne (EPFL), and cyber security companies. Announced last month, it will become operational in October. The…

Fintechs are finding it harder to attract funding this year compared to last. Venture capital fell by more than a third in the first six months of 2020 compared to 2019, with investors preferring medtech, biotech and cleantech projects over financial technology. Early and growth stage funding hasn’t dried up completely, as evidenced by crypto storage firm Metaco this month attracting CHF17 million from a consortium of investors. Bank Vontobel recently invested a “small single digit million” sum into the newly created Yapeal fintech bank. But despite some notable successes, the overall trend points to a tightening of belts in…

It’s been an interesting few days for digital payments, blockchain finance and cryptocurrencies in Switzerland, with several companies and projects announcing developments. At the tail end of last month, budding crypto bank Mt Pelerin said was applying for a Swiss fintech license, aiming to join the only recipient of that category so far – Yapeal. But more interesting still, was that Mt Pelerin held its first shareholder meeting on the blockchain. Mt Pelerin is one of the most interesting blockchain start-ups that I’ve been tracking for some time. In 2018, it claimed to be the first company in Switzerland to issue shares…

It appears that central banks are devising a response to decentralised money, such as bitcoin – by contemplating new centralised digital versions of their own currencies. This goes by the name of Central Bank Digital Currency, or CBDC. Libra’s stablecoin project launched in Geneva last year was a “watershed” moment that “kicked everyone in the pants”, Michael Sung, a professor at Fudan University, told the Crypto Finance Conference (CfC) in St Moritz last month. This prompted China to “massively accelerate” its drive to digitize the renminbi. Sung is convinced that the plan is to spread the RMB far from China’s borders and “increase adoption throughout…