Switzerland businesses are urging their government to allow banks in the country to add cryptocurrency transaction system, says the Financial Times.
In an exclusive interview to the economic publication, Crypto Valley’s Heinz Tannler says,
“We hope to clarify relationships by the end of the year at the latest. Time is pressing – other jurisdictions such as Malta and Singapore are very active and making a lot of effort to attract these companies. The lack of access to bank services is a significant competitive disadvantage.”
The environment in Switzerland is primed for virtual currency transactions, and it is only the government and regulatory restrictions which are preventing the booming of cryptocurrency businesses in the country.
Waiting for “Competitive Advantage”
The alpine country is already an established destination for traditional banking, with a large number of global and local institutions having set up their operations here. There already exists a mature banking ecosystem, infrastructure and necessary talent pool for optimized banking services in the region.
Besides, their reputation precedes them as an exclusive banking system, which fiercely protects the identity of their account owners. Hence, cryptocurrency‘s philosophy is already a part of the banking culture in Switzerland. Thus, all that the country’s administrators will have to do is to allow banks to accept the digital currency processes.
Thus far, however, the country has resisted such a move, despite 2017 being the year where Switzerland saw the second largest volume of ICO funds in the world.
Money Laundering Fears
If Swiss banks begin to accept crypto’s, then they will be on par with the pro-crypto environment in places like Singapore and Malta. These nations have built the ecosystem for such transactions and are attracting businesses in large volumes.
The laws here are custom-made for the easy use and adaptation of cryptocurrencies in their economies. On the other hand, the current banking laws in Switzerland are limiting such adaption as they follow traditional transaction system and thus fail to match the expectations of crypto industry.
However, the biggest road-block for Switzerland to permit use of cryptocurrencies is the fear of money laundering. Tannler says,
“I can understand that banks are careful with respect to ‘know your client‘ and anti-money laundering. But experts reckon the danger of money laundering is lower than in other sectors of the finance industry.”
Things are beginning to change at this level as well, says Tannler, “We have to push certain national institutions to resolve this problem quickly and effectively, but that now seems to be going well,” Tannler shared in the interview.
The first of these changes towards mainstream cryptocurrency use was evident on June 19, 2018. The FINMA has for the first time allowed a company, Crypto Fund AG, the “license to distribute investment funds.” The last previous such helpful laws for cryptocurrency use in the country was in early 2018, when FINMA set up ‘regulatory guidelines’ for ICOs.
Zug, is the capital of cryptocurrency movement in the country and has adopted various technologies to take this forward. It has even explored of the blockchain technology in its voting systems.
By introducing changes, Switzerland has the opportunity to increase its presence in the crypto industry and improve access in the banking services for businesses which are based on cryptocurrency and blockchain.
