From time immemorial, quiet Switzerland has been associated with the world’s most delicious chocolate, quality watches and, of course, developed banking. But it looks like this list can now be replenished with the country’s incredibly successful breakthrough in the crypto industry over the past 3 years. And there is an absolutely logical explanation for this order of things. This is the canton of Zug or the so-called Crypto Valley.
Crypto Valleyis an ecosystem centered in and around the Swiss canton of Zug, with active contacts with international centers of Blockchain innovation in London, Singapore, Silicon Valley and New York.
Crypto Valley and Its Place in the Blockchain World
With its business-friendly regulatory environment, premier talent pool and sophisticated infrastructure, Crypto Valley is quickly becoming a global hub where emerging crypto, Blockchain, and other distributed ledger and technologies can thrive in a safe, supportive and vibrant environment. It has already attracted dozens of leading crypto companies and organizations, including Ethereum, Monetas, Bitcoin Suisse, Xapo, ShapeShift, ConsenSys and Tezos.
The Crypto Valley Association was created to promote the growth of this ecosystem. It drives innovation through collaboration and partnerships with entrepreneurs, startups, investors, corporations, educational institutions, service providers and government agencies.
Since the invention of Bitcoin in 2009, the cryptotechnology ecosystem has been rapidly evolving. From cryptocoins, blockchain and distributed ledgers based on decentralized transaction platforms, commercial property registries, digital identities, secure electronic voting systems and the Internet of Things, a variety of technologies have emerged that enable the creation of new types of digital property, as well as secure and efficient digital asset exchanges.
Crypto ATMs can be found in the canton of Zug. A number of different commercial and government institutions accept cryptocurrencies for payment. But the most important thing is that it has a huge number of companies that work together with the government to develop Blockchain technologies. By the way, even elections are held using this technology.
Why Switzerland?
Crypto Valley, located in Zug, in the heart of Switzerland, has unique capabilities that allow you to make the most of the decentralized Swiss political system and its unprecedented business environment.. Zug offers a strong platform for global growth thanks to its pro-business philosophy and the openness and easy accessibility of its local government. The canton's low taxation, business environment, and excellent quality of life attract many of the world's leading companies, creating an international cosmopolitan culture and easy access to powerful global networks.
Switzerland is one of the world's most advanced countries in the area of privacy protection, thanks to the first bank secrecy law dating back to the third century AD and in force until 1713. And current privacy laws are among the strictest in the world.
Switzerland is also one of the few to have sound economic policies, including the highest foreign exchange reserves and the world's highest per capita GDP.
The Swiss financial market regulator, FINMA, encourages self-regulation rather than burdensome vertical licensing, being the most open and easily accessible forum for the development of improved rules.
The Swiss government went further. It allowed the SIX Digital Exchange company to trade cryptocurrencies.
The SIX company owns the Swiss stock exchange. SIX Digital Exchange will become a cryptocurrency exchange, which will be controlled by the Swiss National Bank and the financial regulator FINMA. The platform will be launched in the first half of 2019. It will offer trading, settlements, and storage of cryptocurrencies and tokens.
Lack of regulation is one of the main problems for all cryptocurrencies. Today, many cryptocurrency companies are drawn to Switzerland for the reason that it is in this country that they will receive clear and specific conditions for interaction with the government. This gives them a chance to develop and look forward to a bright future.
Legal regulation of cryptocurrencies in Switzerland
Bitcoin and other cryptocurrencies are considered in Switzerland as digital assets in accordance with the report of the Swiss Federal Council (clause 2.2.1), and therefore they are neither securities nor financial contracts, that is, derivatives (futures, options, etc.), nor property rights.. Cryptocurrency activities are also regulated by the provisions of the Swiss Criminal Code (hereinafter referred to as “SCC”), for example, for money laundering using cryptocurrencies, a person is liable in accordance with Article 305bis SCC.
The Swiss Federal Council is currently taking steps to develop the legal status of cryptocurrencies and rules for regulating the fintech industry in the country.
Swiss cantonal authorities are also actively integrating cryptocurrencies into everyday life people.
The use of cryptocurrencies to purchase goods and/or pay for services, as well as the acceptance of cryptocurrencies as a means of payment, do not require obtaining any license.
When buying and selling bitcoins, as well as other cryptocurrencies on a commercial basis, legal entities and individuals must comply with the requirements of the Swiss Anti-Money Laundering Law, including the need to carry out KYC (Know Your Customer).
Trading platforms (cryptocurrency exchanges) that are used to transfer funds or cryptocurrencies between users of the platform (between cryptocurrency wallets of the exchange) or from the user of the platform to other persons (from a cryptocurrency wallet provided by the exchange to a third-party cryptocurrency wallet), are also required to conduct their activities in accordance with the provisions of the Swiss Anti-Money Laundering Law.
In accordance with the position of FINMA, a trading platform (cryptocurrency exchange) must either become a member of a self-regulated organization (SRO) or apply to FINMA before commencing operations to obtain a special license to operate as a directly subordinated financial intermediary (DSFI).
FINMA also believes that a special banking license may be required to carry out certain business activities related to bitcoins and cryptocurrencies. For example, a license is required if an organization on a commercial basis accepts money from clients and stores it in its accounts, or accepts cryptocurrency from clients and manages these cryptocurrency assets in the interests of its clients..
After receiving a license, the company will be subject to supervision by FINMA, which will monitor the company's activities, check the compliance of such activities with all rules established for conducting a certain type of activity, as well as compliance with capital adequacy requirements that are established for banking institutions.
Cryptocurrency in Switzerland is treated on an equal basis with foreign currencies; transactions using cryptocurrency are not subject to VAT. As a general rule, transactions with cryptocurrencies do not require special permits (licenses), however, certain types of activities related to cryptocurrencies, including the purchase and sale of cryptocurrencies (in particular, bitcoins) on a commercial basis and on existing trading platforms, may be subject to licensing under certain conditions.
The general requirements of Swiss anti-money laundering legislation also apply to transactions with cryptocurrencies. In July 2017, the Swiss Federal Council announced the creation of a “regulatory sandbox” aimed at creating a favorable environment for fintech startups.
Swiss National Cryptocurrency
The new national cryptocurrency could be called E-franc. The head of the Swiss stock exchange, Romero Lacher, said that it is possible to issue a cryptocurrency version of the Swiss franc. By following this path, the Swiss economy will receive an impetus for development, which will bring its own benefits. “E-franc under the control of the central bank will create additional synergies, which will have a positive impact on the economy. I don’t like cash,” Romero commented to The Financial Times.
Meanwhile, the intentions of the Swiss authorities to create an international platform in the country with friendly rules for crypto projects have not changed. Finance Minister Johann Schneider-Ammann has publicly stated that Switzerland is aiming to become a “cryptonation”. In confirmation of this, a number of ICO projects at one time received government support: tax benefits that are provided to companies registered in special regions with friendly regulation.
According to Forklog
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