Swiss financial authority to create a true cryptocurrency market condition, so that the country will continue to be competitive in the industry and not be left out in the benefits of cryptocurrency.
The decision is in response to a recent trend of migration of cryptocurrency firms from Switzerland to neighboring countries over the not so good market conditions and their rejection by commercial banks in the country.
The need for a favorable condition for cryptocurrency market in Switzerland
There has been a recent move of cryptocurrency startups from Switzerland to their neighboring countries; this has spurred the need to make favorable conditions for the market in the country. Efforts to see the cryptocurrency market thrive again in the country led to making clear regulations for the banking industry to ensure cryptocurrency project continues to succeed in the country, and that the state does not miss out of the massive opportunities in it to their neighboring countries.
Switzerland is already losing opportunities to their neighbors, which includes Gibraltar, Lichtenstein, and the Cayman Islands, according to Reuters. Even though the market is small in comparison to the traditional financial institution, it still employs a sizable number swiss citizens, which the country would not want to lose out on.
There has been a considerable growth of cryptocurrency market recently in Switzerland, this has led to the emergence of a cryptocurrency community known as the crypto valley in Swiss Canton of Zug and has about 200 to 300 crypto businesses. Despite this, the country’s law poses a tough stance on the growth of the cryptocurrency market.
Zug’s finance director Heinz Taennler, states that crypto startups will choose to leave the country when they have no adequate access to the banking system.
“All their banking relationships are going to Lichtenstein,” said Heinz. “These are hundreds of jobs that have been created, and every job is important,” he further added.
A member of the governing board at the Swiss National Bank (SNB), Thomas Moser, states that the crypto firms “… raised concerns about problems with opening bank accounts which was a worry for them and asked for help.”
“I said this was not something the SNB dealt with, but they should speak with FINMA.”
Moser further said, “We would not want to close the door on the opportunities that such innovation (cryptocurrencies) might bring.”
The Fear of Swiss Banks
FINMA is already looking into means of correcting the situation as the Swiss Banks are waiting for clear regulations for relating with crypto firms from the government.
Two Swiss banks are no longer working with cryptocurrency businesses, as reported to Reuters. Zuercher Kantonalbank, which is one of the banks closed down 20 bank accounts related to cryptocurrency in 2017.
Fear over the improper anti-laundering check for donators to companies that launch ICO continues to grip Swiss Bank because partnering with such will lead to the violation of anti-money laundering rules.
As this situation continues to rife, neighboring countries continue to grow in cryptocurrency market. But there is an assurance from Swiss regulators to salvage the situation.