The year 2020 was marked by a substantial rise in bitcoin and the growth of DeFi (decentralized finance). Many of these projects were the birthplace of Crypto Valley, a region in Switzerland that attracts hundreds of companies in the sector, and has already gone beyond its borders. Learn more about the region and how it reached the current level.
What is Crypto Valley?
While Silicon Valley — home to tech giants — in the U.S. has adopted the name of the material of technological components, Crypto Valley embraces the name of the industry it has attracted: cryptoassets and cryptocurrencies.
Crypto Valley was born in Zug, a canton of Switzerland, but has grown so much that it now includes areas of Liechtenstein.
Why Zug?
According to the Crypto Valley Association, Zug attracts companies because of its “pro-business philosophy”. Advantages of this canton, for example, are low taxes and a business-friendly environment, which favors those who want to become an entrepreneur in Switzerland. Besides, the signal that it would be possible to pay taxes with cryptocurrencies also reinforces the idea of a more open attitude for companies in the sector.
But if the payment of taxes only begins to apply in 2021, it has been possible since 2016 to use bitcoin in other official operations. That year, it became possible to pay for small government services with the leading cryptocurrency. It is the case, for example, with the issue of a birth certificate or an identity document, explains Join Up — the European Union’s platform for e-government matters.
Zug’s decision to focus on crypto was the way out to deal with the change in Swiss laws that harmed former local businesses. These changes include, for example, the end of bank secrecy in the country. In addition, the canton has its council promoting the region. It managed to attract companies like Ethereum.
Expanding
Despite the coronavirus pandemic, Crypto Valley grew in the first half. According to the CV VC report, 919 major blockchain companies, 50 Crypto Valley companies are worth US$ 37.5 billion are part of the Crypto Valley ecosystem. In the previous semester, they were 842. As well as the number of initiatives in the region, the number of employees increased, which became 4,780 (up 8.6%).
What does the region differ?
The CV VC report points out that the concentration of key players in the region is “well above the critical mass required to foster the successful creation” of significant innovations and their adoption.
What types of businesses are in Crypto Valley?
However, the areas of expertise go far beyond cryptocurrencies, as the name may make it seem. Of course, there are companies that use blockchain for payments, but business goes far beyond that.
4ARTechnologies, for example, develops solutions for the art world. One of the possibilities it opens up is the use of technology to ensure the authenticity of art works in the real world —not digital certificates.
On the other hand, Modum uses blockchain to digitize supply chains. The technology is used, for example, to automate product monitoring.
There are also companies in the areas of insurance, crypto banks, exchanges, loans, protocols. Also, there are payments, e-wallets, data and analytics, entertainment, and others.
