Switzerland starts project to become Blockchain Capital of the World
The economic minister of Switzerland, Johann Niklaus Schneider-Ammann, has laid out plans which would help cryptocurrency startups in Switzerland to get off the ground and would eventually make the country the “Blockchain Capital of the World.”
Switzerland has a history of sketchy banking which it is now planning to leave behind. For quite a long while, people wanting to store large amounts of wealth have chosen to store it in Swiss banks since the banking system in Switzerland has been open to such individuals or companies. Now, however, the country is investigating emerging financial markets and many startups in major cities in Switzerland are now planning to be crypto-financial centers later.
According to PwC, one of the largest auditing firms in the world, four of the ten largest ICOs in 2017 were based in the small European country. The aim for some lawmakers is to use the country’s strong banking system, low taxes, and high education rate to make Switzerland the “Silicon Valley” of cryptocurrencies.
The heart of the crypto expansion in Switzerland is found in the town of Zug. This community of 120,000 individuals is the epicenter of the country’s Crypto Valley. Its low corporate tax rate of 14.6% has lured quite a few startups, which has resulted in the town’s growth and a lower unemployment rate. For crypto enthusiasts, Zug has special meaning as it is where Ethereum was incorporated, not to mention it being the first location where Bitcoin ATMs were installed.
The expansion of crypto-projects in Switzerland is helping the country offset some of the losses in the banking sector they’ve seen in the past few years. In the past decade, Switzerland has lost 20% of its banking institutions. The Swiss financial regulatory institution, Finma, approached a few digital currency startups about the benefits of Switzerland, especially a regulatory body that is quite accommodating and willing to work with new technologies. This relaxed attitude is shown by the comments of the CEO of MyBit, Ian Worrall, who said the strategy from regulators has been “Do your best, and if you mess up we’ll work with you.”
Overall, the business and crypto-friendly environment are luring startups to Switzerland, as is evident by the number of startups found at Crypto Valley Labs jumped from 15 all the way to 100 within a year. Yet the government has backtracked a bit from fully embracing cryptocurrency and has instead pivoted to promoting blockchain technology. Economics minister Johann Schneider-Ammann famously called Switzerland “Crypto Nation” a few months back, but he has now moved to the broader “Blockchain Nation” instead.