Four of the 10 biggest initial coin offerings last year were in Switzerland, more than any other country
ZUG, Switzerland—When 24-year-old Ian Worrall launched his crypto-investment startup MyBit last year, he chose this Swiss lakeside city.
It was an odd fit: the no-holds-barred corner of the financial markets meeting button-down Switzerland.
Yet this nation, as closely tied to its ultrasafe Swiss franc as it is to the Alps, is entranced by volatile digital currencies. Buildings in Zug and in Zurich, Switzerland’s financial center, are blossoming into crypto-finance hubs.
Four of the 10 biggest initial coin offerings last year were in Switzerland, according to PwC, more than any other country.
The hope is the country’s banking prowess, low taxes, elite universities and the Swiss brand itself will do for Switzerland what Silicon Valley did for the U.S.
Efforts to expand the so-called Crypto Valley into what Switzerland’s economics minister has called Crypto Nation have seen some success and may offset the country’s shrinking banking sector. The number of banks here has fallen 20% in the past decade, according to the Swiss Bankers Association.
Switzerland “is the best from a tax, legal and operational standpoint,” Mr. Worrall said from the MyBit headquarters in a startup hub called Crypto Valley Labs, where the “California Republic” state flag hangs in his office.
MyBit is an investment platform to fund Internet of Things devices like self-driving automobiles. It raised the equivalent of some $3 million in an initial coin offering last summer.
The space once housed an energy-technology company. There’s a circus school next door.
The number of companies at Crypto Valley Labs and another location jumped from 15 early last year to over 100, said Mathias Ruch, managing partner at Lakeside Partners, which developed the site. “I’m signing contracts on a daily basis,” he said.
The canton of Zug, population around 120,000, has emerged as the heart of Switzerland’s Crypto Valley. Its population grew at the fastest rate of all Swiss cantons in 2017, and its jobless rate is 2.3%, below Switzerland’s 2.9% average and down 0.2 percentage points from a year ago. Its corporate tax rate is 14.6%.