Switzerland’s Crypto leadership in danger
Perched on the podium of cryptocurrency fundraisers in 2017, Switzerland is backing against new competitors. Now looking for avenues to strengthen the country’s position for crypto leadership.
Emblematic of the boom of cryptocurrencies, the fund raising in tokens, or ICO (Initial Coins Offering), are booming. Switzerland was, until recently, at the forefront of this phenomenon after hosting 4 of the 10 most important ICO ever made. However, in the first five months of 2018, the Confederation was relegated to sixth place worldwide.
Different nations have made breakthroughs, as shown by a PwC study. In 2017, Switzerland was in second place behind the United States and ahead of Singapore. The country still enjoyed the status of a cryptocurrency mecca obtained especially when Vitalik Buterin chose Zug to create his Ethereum Foundation in 2015.
But since then, other places have advanced their pawns. During an ICO at the beginning of the year, Antoine Verdon raised $ 25 million with his partner Patrick Allemann for their startup Proxeus. The native Vaudois testifies: “In spite of the experience available to local stakeholders, we chose Liechtenstein when preparing our ICO following very positive exchanges with the local regulator.”
Crypto leadership: 48 ICO raised $ 507 million
At the origin of the think tank 2B4CH, Yves Bennaïm is tough: “Zug has self-proclaimed” Crypto Valley “. It’s bluffing because Switzerland has never been in the forefront. Of course, there are advantages in terms of discretion, taxation and administrative ease that have played out. But in terms of openness to crypto industry and crypto leadership, other places are much more interesting. “
The jump in competitiveness is immediately felt because in an intangible sector such as crypto, moving a seat no longer poses any difficulty. “Several teams based in Zug have already moved. Programs created by countries like Singapore are very attractive, “confirms Antoine Verdon. Founder of the bitcoin trader SBEX (now bity), Alexis Roussel nuance, however: “Fifty companies without a bank account but with a cryptocurrency capital have been created in the last six months. Few countries do the same. The number of new jobs is still growing. “
Still, in 2018 in Great Britain, 48 ICOs raised a volume of 507 million dollars. London is ahead of Switzerland with only 28 ICOs totaling $ 456 million. The historical rivalry between the two financial centers now extends to the world of crypto leadership. The authors of the PwC study speak of enormous pressure exerted on the places in competition. The billions of dollars raised by EOS and Telegram, respectively in the Cayman Islands and the British Virgin Islands, have propelled these places to the top of the world rankings. At the same time, the Baltic States as well as Israel and Hong Kong attract large volumes.
“These sites reacted very quickly to new opportunities. Smaller countries can generally be more agile,” says Daniel Diemers of PwC. Another co-author of the study, Günther Dobrauz says: “Most of these countries have copied Swiss success factors to reach a crypto leadership. What they bring more is a strong and consistent support from their entire government. “This is how Malta quickly acquired a status in sight. “The archipelago has taken action, while Bern continues to discuss without commitment. It is on this difference that entrepreneurs and investors select a site, “adds an observer.
Crypto leadership, Imitate Singapore or Dubai?
The rise of Estonia, Lithuania and Israel shows that it is not essential to be a financial center to get a crypto leadership. “We are experiencing the beginnings of an industry that will shake up the economy, as the internet did in the late 1990s. The scoring countries say this: we do not know yet what the future will look like.but we are committed to supporting the crypto entrepreneurs and guarantee that we will not go backwards, “analyzes Yves Bennaim.
In Switzerland, on the other hand, the uncertainty remains total. “Try to talk about cryptocurrencies with a Genevan banker. It is as if, at the end of the last century, you evoked the potential of email with a postman. And that this one focuses his attention on the future format of the envelopes”.
Antoine Verdon explains: “Switzerland has managed to create a relatively clear regulatory framework, but there are still problems to be solved. Banks need guidelines on what conditions they can accept ICO funds. “It’s undeniable that the profile of crypto cracks surprises the world of finance. They are “Ukrainian teenagers”, “Chinese based in Malta” or “old Californian libertarian alternative punks”.
“Regarding talent, we could take example of Singapore as crypto leadership, which offers great freedom, adds Antoine Verdon. Here we have just recruited a Chinese programmer specializing in “smart contracts”, who did her doctoral work at ETH Zurich. We had to fight for months to get a place in the quotas. Yves Bennaim evokes a track to change the legislative framework. Cantons like Zug, Neuchâtel, Ticino and Geneva could form an alliance capable of understand the priorities to the national authorities. “As for Antoine Verdon, he advocates to” imitate Dubai and launch a program to adopt blockchain technologies at the government level. Battle for the crypto leadership on the way. “