My first association of Switzerland is chocolate. Or banks. Or luxury watches…
But this rich Central European country is looking for further ways to grow its economy. And since it is already versed in managing other people’s money, they are turning to cryptocurrency and the blockchain technology.
NOTE: This article has been updated with additional points — there are many things happening in Switzerland, as you’re about to see.
And it’s doing it really well, as you’re about to see… Here are few things Switzerland does to attract digital asset innovation:
1. Switzerland has the world’s densest Bitcoin ATM network
In November 2016, the national railway company of Switzerland, Swiss Federal Railways (SBB), has added Bitcoin ATM functionality to more than 1,000 of its ticket machines, making Switzerland the country with the densest Bitcoin ATM network in the world. This pilot project is to last for a minimum of two years and is operated by Swiss financial services company Sweepay.
To buy bitcoins, customers only need a Swiss phone number and a Bitcoin wallet. Between 20 and 500 Swiss Francs can be exchanged for bitcoin per transaction.
In order to use SBB ticket machines as Bitcoin ATMs, customers select the “Mobile top up” option and then scan their QR code on their bitcoin wallets. However, you cannot top up Bitcoin by credit card.
2. You can (will be able to) pay taxes in Bitcoin
The municipality of Chiasso in Switzerland will soon be accepting tax payments in bitcoin, according to a local news report.
The scheme will be ready for the start of next year and was apparently made following discussion with blockchain groups based in the area.
There will be some limits though, and tax payments made in bitcoin will not be able to exceed 250 Swiss francs (around $265).
Chiasso was nicknamed the “CryptoPolis” and has reportedly seen eight startups set up base there in the past few months. Its biggest rival in the country is the City of Zug, which leads to the next point…
3. You can pay for public services with Bitcoin
The city of Zug has started a pilot project that allows local citizens to pay for public services using cryptocurrency.
The initiative went live on July 1st and will run through the rest of the year, after which the results will be reviewed and the project could leave the pilot phase.
“The pilot project of the city government is initially limited to a limit of 200 francs on chargeable services the residents of the city train,” the announcement on the city’s official website reads. “At the end of 2016 [we will conduct] an analysis of lessons learned. Then… the city council [will decide] if bitcoins and most other digital currencies are to be accepted as payment for other urban services in the future.”
Several digital currency startups such as Xapo, ShapeShift and Monetas are located in and around Zug, and this is part of the city’s efforts to attract more financial tech firms to the region.
“We want to express our openness to new technologies and expressed early on your own experiences. And we will invite to exchange ideas with the City Council FinTech companies in the region train,” City mayor Dolfi Müller said in a statement. “Our goal is to meet their needs for optimal development in our living and economic environment in more detail.”
4. The City of Zug also offers an Ethereum-based ID service
Another thing related to the City of Zug… It is now offering digital identity services through an app, connecting a person’s ID with a particular crypto-address. Local citizens can register and get verified by city officials.
Said app uses the uPort identity platform created by Ethereum development community ConsenSys, and its developers include the Swiss startup ti&m and the Lucerne University of Economics.
“We want a single electronic identity — a kind of digital passport — for all possible applications,” Dolfi Müller, Zug’s president, said of the project. “And we do not want this digital ID to be centralized at the city, but on the blockchain.”
Müller added that the city plans to hold a consultative vote on electronic ballot access, expected to take place next spring.
5. A few local banks offer cryptocurrency asset management to their clients
Swiss financial institutions Falcon Private Bank and Swissquote offer Bitcoin investing to their customers, with the former also offering other cryptocurrencies — namely Bitcoin Cash, Ethereum and Litecoin.
Zurich-based Falcon said that the move, conducted in partnership with Bitcoin Suisse AG, proves its “agility and underlines its strategic repositioning” on the market.
The new offering, in case you wonder, is advertised as blockchain asset management service. As far as we know, a similar service is not provided by any financial institution in other parts of Europe.
6. You can pay for tuition with cryptocurrency
The Lucerne University of Applied Sciences and Arts in Switzerland is now accepting Bitcoin payments for tuition.
To be fair, the University is not accepting Bitcoin directly as a form of payment; instead it has entrusted payment processing to Bitcoin Suisse AG, which in turn exchanges bitcoins to Swiss Francs at the time of transaction.
Nonetheless, this is cool even with such system in place. But, the university is not expecting a ton of students to take advantage of this capability.
“Those most likely to avail themselves of this opportunity will either be already familiar with the concept of financial services and Blockchain, or interested in pursuing continuing and executive education opportunities in this subject area,” the University said.
7. Switzerland is one of the most welcoming environments for cryptocurrencies
The other leading country being Singapore, according to a recent report from the fintech analyst and research firm Autonomous NEXT.
In Switzerland, business is regulated by the Swiss Financial Market Supervisory Authority (FINMA), but cryptocurrency companies do not require any specific approval or license. Under the law, cryptocurrencies are assets rather than securities.
That apparently is not enough with the Swiss Federal Council working on digital currency rules as we speak. In particular, the government aims to create a more accommodative environment for fintech and blockchain/cryptocurrency startups.
Unfortunately, we don’t know what exactly the Swiss Federal Council will come up with, but they did say that the work on “clarifying the legal qualification of virtual currencies, has been taken over and is to be swiftly pursued.”
Whatever the end result ends up, chances are Switzerland will remain one of the top countries for doing business related to cryptocurrencies. And other “forms” of money, for that matter.