Switzerland Poised to Become a Crypto Paradise

Switzerland Poised to Become a Crypto Paradise

by October 2, 2018

Switzerland is quickly emerging as a crypto paradise, supported by the country’s banking prowess, low taxes, elite universities and the Swiss brand itself that have attracted foreign cryptocurrency and blockchain startups into settling in the small European country.

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Image via Pxhere

Efforts to expand the so-called Crypto Valley in Zug into what Switzerland’s economics minister Johann Schneider-Ammann has called Crypto Nation have seen some success.

“We have over 400 players already in Switzerland and the government is very pro-business, very helpful,” Oliver Bussmann, president and co-founder of Crypto Valley Association, told Cointelegraph.

“It’s a very decentralized culture and it’s really in line with what blokchain and crypto assets are. The Swiss Financial Market Supervisory Authority (FINMA) is trying to move the whole crypto asset business into more regulated security token. There’s a high probability that we will see unicorns coming out of Switzerland in the next few years because I think the foundation is in place.”

FINMA, the financial regulator, issued clear guidelines to businesses in Switzerland looking to issue their own crypto tokens. The regulator held a series of roundtable discussions across the country to present and clarify the guidelines.

According to PwC, four of the ten biggest initial coin offerings (ICOs) in 2017 were in Switzerland, more than any other country.

To support the growing crypto industry in Switzerland, blockchain incubators and hubs have been in a high demand in the country.

Trust Square, the largest blockchain hub in Switzerland located in Zurich, currently hosts blockchain companies from different backgrounds. “The history behind Trust Square is that several blockchain entrepreneurs wanted to have a community,” said Frederic Meyer-Scharenberg, blockchain hub manager at Trust Square. “All floors of Trust Square are full with all sorts of blockchain startups, from students with some crazy spaceship ideas to more down to earth insurance projects.”

Crypto Villa, a 19th century mansion that formerly housed a private bank from Lichtenstein that went bankrupted, is now the home of Crypto Finance AG, a firm providing blockchain-related services through three subsidiaries: Crypto Fund AG (asset management), Crypto Broker AG (brokerage), and Crypto Storage AG (storage).

Jan Brzezek, CEO and founder of Crypto Finance AG, noted the growing number of bankers leaving the traditional financial services industry to join the crypto industry. In the past decade, the number of banks in Switzerland has fallen 20%, according to the Swiss Bankers Association.

“In our company, we have, I would say, 80% ex-bankers from UBS, Credit Suisse, and some other large banks,” Brzezek said. He said that Switzerland’s strong financial system, financial know-how, and enthusiasm for decentralization matched very well with the crypto space.

“Currently I’d say yes, we are a Crypto Nation, on a very early stage, but we have everything to become a big hub for crypto offering,” Brzezek said.


Crypto Valley of Zug

Zug, also known as Crypto Valley, is perhaps one of most crypto-friendly cities in the world. Zug is home to more than 400 crypto businesses and its mayor, Dolfi Mueller, has presided over a policy of accepting Bitcoin to pay for some city services.

“We didn’t know anything about Bitcoin. We didn’t know anything about blockchain. And so we invited a student who explained us the difference between these things,” said Mueller.

“We started [accepting Bitcoin for government services] two years ago, now we have about 50 or 55 payments or more. And it’s just Bitcoin.”

Zug recently took its commitment to crypto and blockchain a step further and held Switzerland’s first blockchain-based municipal referendum from June 25 to July 1, 2018.

“Let’s start an experiment with the so-called digital ID-based on blockchain. Every year in summertime we have a great party at the lake side of Zug and there is a firework and so we asked people: do you want to have a firework again? Yes or no,” said Mueller.

“I will finish my work at the end of this year and I always say that this makes a very beautiful final of my time as mayor of Zug.”

30km away from Zug, at the Lucerne University of Applied Sciences and Arts, students can take blockchain and cryptocurrency courses and can pay for everything with Bitcoin and other cryptocurrencies.

“We have several programs that are focused on blockchain technology and distributed ledger. We have small ones which only last for two days and give a short overview, and we also have a longer program which lasts for about four months where you really get a real in-depth view in these activities,” said Rene Husler, dean of School of IT. “Right now for the next semester we are also starting the bachelor program courses dedicated to blockchain and distributed ledger.”

The idea is to prepare the younger generations to a technology that will be part of our daily lives, Husler said.

“In the future, blockchain technology will be a base technology that is used in a lot of applications and people actually won’t realize that they are using blockchain,” he predicts.


Featured image via Pixabay