WHY IS SWITZERLAND A CRYPTO TECH-FRIENDLY COUNTRY
Cryptocurrencies are now having a bit of trouble. Yet, one of the most industrialized Western countries is still a top location for #fintech, #blockchain, and #cryptocurrencies. Below, we investigate why Switzerland is and stays among the nations that are most welcoming to cryptocurrencies.
Switzerland is well-known for its financial sector outside of Europe and has long been regarded as a sanctuary for banking. The fact that this reputation is by no means rustic is also shown when you look at the crypto scene, which profits from beneficial business conditions, a progressive legal framework, and the openness of the Swiss nation towards paying and trading with cryptocurrencies.?
In fact, the Swiss banking industry is quickly embracing digitization, automation, and the distributed ledger as the new standards. According to a new study, Switzerland is the world's third most friendly crypto country, after Hong Kong and the United States. The main reason for that is well-established synergies between corporations, R&D, and the Swiss government, which all understood the need for Swiss banking to be pushed in a new direction.
Based on this, it is also not surprising that Switzerland has the highest number of blockchain startups in the world. While Switzerland has "13 companies per 100,000 inhabitants, Hong Kong only has "3 start-ups per 100,000 people," for comparison. (Source: www.weka.ch) Moreover, following this trend, the best-known crypto company in the world comes from Switzerland. It is called Ethereum Switzerland, and as one of the major contributors to the #ethereum protocol, it has been working on Ethereum since 2014.
Indeed, the Swiss political landscape supports Ethereum Switzerland financially via its economic development agency and is also convinced of the advantages of blockchain overall. Because of that, the Alpine country has been regularly revisiting its economic and financial laws for blockchain, fintech, and cryptocurrencies.
As a country, Switzerland is actively involved in international work on the taxation of crypto assets (taxation, automatic exchange of information), and the Federal Tax Administration regularly publishes information on Swiss practice in this area. Also, there is an Anti-Money Laundering Act in place that applies to any financial intermediary activity involving crypto assets. (Source: State Secretariat for International Finance SIF) But to simplify the local legal framework, it is important to know that: (1) all cryptocurrency exchanges are legal in the country; (2) cryptocurrency is officially perceived as a foreign currency here; and (3) most traders are not charged tax on capital gains in Switzerland.
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When speaking about Switzerland and the Swiss crypto companies, the appropriate name Crypto Valley is used. #cryptovalley has become home to a growing community of cryptocurrency and blockchain startups attracted by the favorable regulatory environment in the Zug Kanton, which is located near Zurich. Here, the Crypto Valley Association, a government-backed initiative in the city of #zug, even provides a supportive ecosystem for startups, including access to funding, talent, and infrastructure. With the combination of political stability, supportive regulations, and personal talent, Crypto Valley is fast becoming one of the world's leading centers for blockchain technology, with companies such as Solana, Cardano, and the Web3 Foundation all located here. For a broader public, Zug might be known for its 46 #bitcoin ATMs and the possibility to pay for certain municipal services with cryptocurrency. The city is also experimenting with allowing municipal voting using blockchain, the technology that underpins bitcoin. This project is, however, still in the works.?(Source: Kanton Zug)
In the end, Switzerland's goal of making digital assets appealing to the general population appears to be successful. In other words, blockchain and cryptocurrencies are fascinating to regular people as well as organizations like the Cardano Foundation, a non-profit located in Switzerland that works to promote the usage of the Cardano blockchain technology. Accordingly, a number of studies show how popular crypto assets are among regular people, who google them far more frequently than other Europeans and are also much more trusting of them as a source of wealth income. (Source: Crypto Readiness Report) The fact that half of Swiss adults might see themselves investing in cryptocurrencies and that a significant portion of those between the ages of 18 and 24 now think that cryptocurrencies may someday be used as currency is also quite encouraging. (Source: Handelszeitung, Bearing Point study)
Possible explanations for why the #swisstech, #swissfintech, and crypto scenes are at the forefront are the long neutrality of the state, the booming banking industry, and the foreign investment coming to the country from all over the world. It offers both citizens and companies the opportunity to familiarize themselves with the scene, use #cryptography if necessary, or even put it at the center of attention. It will be interesting to see what achievements #Switzerland can achieve on the crypto path in the future.
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