Swiss Crypto Valley is winning the race to attract crypto-centric companies

Bitcoin Suisse and Worldline partner to expand crypto acceptance at PoS

Although the financial press rarely covers the issue, there is a competitive race, an “arms” race, if you will, taking place across the globe, as various national interests do their level best to attract the greatest and the finest of crypto related enterprises to relocate or set up shop in their locales. The “level best” often includes adopting very accommodating legislation for blockchain technology, but not necessarily for the token side of the business. Banking institutions have resisted, but where they have complied, success soon follows. The Swiss Crypto Valley is one such success story.

We reported last January that: “If the truth be known, there has been a silent and ongoing “arms race” of sorts by small financial centers across the globe, each seeking to win the favor of the current titans in the crypto ecosphere. A brief list of contenders includes Malta, Bermuda, Gibraltar, the Seychelles, Switzerland, Puerto Rico, and Liechtenstein.” At the time, Malta had succeeded on the crypto exchange front, beating out Hong Kong as the leading processor of the most crypto volume on the planet.

News today is that the Swiss Crypto Valley, which includes six clear hotspots, i.e., Zug, Zurich, Geneva, Ticino, Liechtenstein, and Vaud, is winning the race for, perhaps, the rest of the crypto slate by boasting more than 800 companies active in cryptocurrency and blockchain, which employ over 4,000 professionals. The “Top 50” blockchain companies in Crypto Valley doubled their valuations in the first six months of 2019 from USD $20 billion to USD $40 billion. Six of these companies, referred to as “Unicorns”, are now valued at more than USD $1 billion.

The Swiss Investment company Crypto Valley Venture Capital (CV VC), with support from PwC’s Strategy& and its IT partner inacta AG, has released its latest quarterly update of the largest and most important crypto-related companies in Switzerland and Liechtenstein. Mathias Ruch, Founder and CEO of CV VC, noted: “Crypto Winter undoubtedly left a mark on the industry, but companies with strong fundamentals and emerging use cases have significantly increased valuations.”

More than a majority of the registered companies that comprise the 800 figure are located in the Swiss Canton of Zug, considered to be the heart of Crypto Valley. Bitmain, the world’s largest mining operation has an operating office in Zug, as well as three major protocol projects: Ethereum Foundation, Cardano and Dfinity Foundation with its headquarters and over 40 employees in Zurich. Two new protocol companies, valued over USD $1 billion, joined this illustrious group this quarter: Cosmos Network and Polkadot.

The catalyst for such explosive growth can be traced back to the government’s adoption of accommodative regulations for the crypto industry, but one more key step was necessary from the Swiss Financial Market Supervisory Authority to open the “flood gates”. In February, we reported: “The Swiss crypto community is abuzz with the news that Julius Baer, a Swiss banking giant, plans to provide its clients access to digital asset services, following a partnership with crypto bank startup SEBA Crypto.” Several other banks soon joined the fray, including Bitcoin Suisse, Sygnum, and Mt. Pelerin Group.

The variety of crypto-related companies operating in Crypto Valley is extensive and covers the gamut of crucial use cases deemed of high priority. Regulators want to see more secure custodial services, and this opportunity has not been missed by some of Switzerland’s most well known firms, which have set up custody subsidiaries in the region: Bitcoin Suisse (Swiss Crypto Vault), Crypto Finance (Crypto Storage) and Taurus Group (Taurus Protect). The New “Top 50” list also includes additional firms from the wallet and vault sector, protocol development, blockchain network management, and a Zug-based entity with plans to issue a stable coin.

According to comments from Dr. Daniel Diemers, PwC Head Blockchain EMEA and Partner for Financial Services at PwC’s Strategy&:

This development clearly signals increasing maturity in the space and the favorable regulatory and business environment we have here in Switzerland. But this is just the beginning: as the market infrastructure levels up, we will see more and bigger projects develop and grow in the Crypto Valley Switzerland.

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