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Crypto: at the heart of the Swiss ecosystem

Crypto: at the heart of the Swiss ecosystem

Is Switzerland the crypto 'paradise' that some people make it out to be? The Big Whale went there to find out.

Where do I begin to tell you about Switzerland?

Perhaps with the most obvious: NO, and at the risk of disappointing some, Switzerland is not a crypto paradise.

  • Bitcoin is not the official currency
  • You can't pay in cryptos in all shops
  • Some banks refuse to open accounts for companies in the ecosystem

And we could go on like this for a long time 😅.

On the other hand, Switzerland - population 9 million - is clearly one of the most welcoming countries, thanks in particular to its particularly attractive taxation on cryptos (There is no capital gains tax for individuals), as we were able to see during our report.

Small (non-exhaustive) overview of the Swiss ecosystem.

👉 Geneva and its banks

Geneva, its banks, its water jet and its... crypto ecosystem. In just a few years, the "Protestant Rome" has managed to position itself as one of the cities in Switzerland and Europe where crypto and the banking world talk to each other the most. Many institutions, such as Julius Baer and the Arab Bank of Switzerland, are working with players in the sector and financing Web3 projects.

As for the larger institutions, such as UBS and Credit Suisse, they are still a little on the cautious side. "They're afraid of the reputational risk", a good connoisseur of the sector explained to us. We won't name names, but we were able to speak to several project promoters whose accounts with Credit Suisse have been closed. When was this? Last week...

In the meantime, things are moving forward in the canton (there are 26 cantons in Switzerland). One of the companies most emblematic of this "bridge" between traditional finance and crypto is undoubtedly Taurus. Founded in 2018, the company based a stone's throw from Lake Geneva has developed a platform for professionals to buy, sell and store digital assets.

Taurus, which now employs around 50 people, works with more than 20 financial institutions, such as French giant Crédit agricole via its subsidiary CACEIS. "We get a lot of enquiries," Lamine Brahimi, one of the co-founders of Taurus, told us.

Some people, however, also talk about "crypto-washing" when it comes to Geneva. "Here we are very good at communicating", explains a Swiss banker, adding, "But apart from a few projects, the canton of Geneva is still lagging behind the others". And particularly that of Lausanne...

👉 Lausanne and Tech

In Lausanne, the Swiss Federal Institute of Technology (EPFL) is an institution. Recognised as one of Europe's top-performing institutions, the EPFL, which hosts around 10,000 students on its campus, is a breeding ground for talent. With a wealth of funding.

This situation has obviously not escaped the attention of crypto players, who have gradually set up shop there to recruit the best engineers. This is particularly true of Metaco, which specialises in digital asset custody and works with several global financial heavyweights such as Citigroup, BNP Paribas and Société Générale...

Other companies such as the financial app Swissborg (find an interview with its boss below) and the YouHodler company have also set up shop on the shores of the lake to take advantage of this highly skilled workforce, as well as the canton's very pro-crypto policy. Not to mention the particularly pleasant living environment.

The canton is also home to Swissquote, the first Swiss bank to offer crypto purchases. That was in 2017! Based in Gland (35 km from Lausanne), it recently announced the launch of an exchange platform specialising in digital assets.

👉 Neuchâtel and its "maxi"

In Neuchâtel, everyone agrees on one thing: the city is experiencing a second youth. And cryptos are not to blame. In less than five years, "Neuch", which is emerging from two particularly complicated decades on the economic front, has created an ecosystem of around forty crypto start-ups, some of which have been created by foreigners (particularly the French).

Projects like Nym, Mt Pelerin or Bity have been attracted by the canton's tax policy, which has cut taxes sharply to attract investors. But that's not all. The town of 45,000 inhabitants has also managed to make a place for itself thanks to the Cantonal Bank of Neuchâtel, which very early on accepted crypto companies that couldn't find banks to go to.

One of the first people to set down their suitcases on the shores of Lake Neuchâtel was none other than Alexis Roussel. The co-founder of Bity, a platform for buying and selling cryptocurrencies originally from Geneva, arrived in Neuchâtel in 2015 after several failures at banks on Lake Geneva.

And others have followed. "We saw projects arrive as we went along," points out Didier Boillat, who is one of five members of the city's executive (there is no mayor in Switzerland) and in charge of digital. Some have criticised the bitcoin "maximalism" of the Neuchâtel community. "It's true that some people are very attached to bitcoin," notes Didier Boillat.

But in the opinion of many, things have eased off. "There are more and more projects," says Maud Bannwart, head of operations at Alephium, a protocol that, among other things, creates secure smart contracts.

👉 Zug and its tax system

In the crypto ecosystem, Zug has almost become a "mythical" town. Located 34 kilometres from Zurich, in eastern Switzerland, the town is essentially known for one thing: having hosted the Ethereum foundation in 2015, as well as several other big projects in crypto (Tezos in particular).

Since then, the town has developed in part thanks to this image as the "cradle" of the ecosystem, with several successes such as the "crypto-bank" Seba Bank. But some also explain that Zug attracts companies primarily for its particularly advantageous tax regime. It is less than 10% for companies...

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