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Zug has been the engine of the Swiss blockchain scene for a decade. Meanwhile, Crypto Valley in Zug has spread across Switzerland and is home to a total of 1135 companies. But the past year hasn’t been a picnic: many Zug-based blockchain companies have shrunk due to economic difficulties. The bankruptcy of the American crypto exchange FTX in November 2022 around young billionaire Sam Bankman-Fried (31) also caused an aftershock in Switzerland. Even if the companies involved deny it for a long time.
“The industry was a little too naive for a short time,” Mathias Ruch (47), founder and CEO of Zug venture capital firm CV VC, tells Blick. He is one of the founders of Crypto Valley. “Many were convinced that the FTX crisis was unimportant to us.” However, the collapse of the crypto market also caused the trading volume to shrink in Zug.
But companies felt it only a few months later. For example, at the beginning of 2023, the fintech company Bitcoin Suisse had to suddenly lay off 20 percent of its employees. In addition, there was a decrease in the number of newly established companies due to great uncertainty.
Not just warm words on the anniversary
Even after that, cryptocurrencies made more negative headlines than jumped in the air. The blockchain industry in Zug does not seem to be concerned that the exchange rates of the two most important currencies, Bitcoin and Ethereum, are still subject to strong fluctuations or even currently on the decline. “It doesn’t directly affect us,” Ruch says. Most Zug companies are primarily concerned with the further development of blockchain technology. “Even if the markets go wild, we continue to operate quietly.”
But not only warm words were spoken on the anniversary at the CV VC headquarters near the train station in Zug. Zug Finance Director and Swiss Blockchain Federation President Heinz Tännler (63) was particularly uncomfortable with the Swiss financial authorities. “Finma seems insecure, hesitant, even worried about permits and licenses.” Still, Tännler believes Switzerland is the best blockchain location. But other places such as London and Paris are now catching up, due to regulatory hurdles in Switzerland. But will Switzerland lose its crypto lead soon?
Million-dollar project for blockchain
Above all, Tännler was probably interested in making the planned Valley project acceptable to those present: As the project sponsor, the canton of Zug will invest 40 million francs in blockchain research. Alongside an institute at the University and the Lucerne University of Applied Sciences and Arts, the two locations will also be brought together by a centre. “The industry has grown rapidly in recent years, but it lacked a compass,” says Bernhard Rütsche (53), a law professor and Vice President for Development at the University of Lucerne.
The multi-million project is intended to help blockchain “reduce bureaucracy, strengthen democracy and decentralize political power,” according to lawyer Rütsche. These are big words. But before that can happen, the project has to pass the Zug Parliament.
Source :Blick
I’m Tim David and I work as an author for 24 Instant News, covering the Market section. With a Bachelor’s Degree in Journalism, my mission is to provide accurate, timely and insightful news coverage that helps our readers stay informed about the latest trends in the market. My writing style is focused on making complex economic topics easy to understand for everyone.
