Thanks to the establishment of the first crypto companies in the Zug area from 2013, the term "Crypto Valley" was soon born in reference to "Silicon Valley". Today, the region in Switzerland is known as one of the world's leading crypto hubs.
If you are talking about global crypto hubs, most people think of metropoles like Singapore, New York, Lisbon or Berlin. Among these large cities, there is a tiny little town on the outskirts of Zurich, Switzerland with a population of about 30,000 people that is leading the global race for innovation in the decentralized technology space. This town is called Zug, also known in the crypto world as the Crypto Valley.
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First-mover advantage
Various rankings of global crypto hubs put Zug in first place. Many of the largest foundations and companies in crypto have their headquarters located in this tiny Swiss city: Ethereum, Near, Polkadot, Dfinity, Tezos – all have their foundations set up in Zug. How come a small city in the valley of Switzerland can compete with global megacities when it comes to attracting and producing talent in crypto?
From a regulatory and tax perspective, Switzerland has always been more open to innovation than its surrounding European countries. In 2015, Vitalik Buterin and team chose Zug as the place to launch the Initial Coin Offering (ICO) of Ethereum. As other crypto founders saw the success of Ethereum in Zug and in the absence of regulatory clarity in other countries, many crypto projects followed Ethereum’s lead and founded their companies in Zug, too. This is how the Crypto Valley started.
Access to high quality talent and service providers
If you are looking to start a crypto company in Zug, you will have access to a large array of talent to choose from. The same lawyers (MME) that structured the Ethereum ICO in 2015 and invented the term “utility token” still work with many of the industry’s leading crypto companies.
In addition, many crypto founders struggle to find a bank for banking as many traditional banks still frown upon crypto. Zug has several crypto-friendly banks (e.g. Zuger Kantonalbank) and even several dedicated Crypto Banks such as Sygnum or AMINA Bank. Even other service providers such as the domicile business Office Group Zug allow companies to pay rent for their offices in stablecoins.
Government supports the Crypto Valley
Most government offices around Europe and the globe are still against crypto as an asset class. They provide very limited assistance to crypto founders, often not taking them as seriously as entrepreneurs in other industries. The Zug government has been supportive of crypto startups from day 1. High ranking government officials regularly attend crypto conferences and visit startups directly to identify their pain points. Even though immigration overall in Switzerland is difficult, the office for migration in Zug actively helps founders in the application process to attract more world-class talent.
Finally, let’s not forget the taxes. Zug offers some of the lowest income and corporate tax rates in all of Europe. In addition, capital gains are exempt from taxes (unless you are a professional trader). If you are a European founder and you want to set up a tax efficient structure in Europe, there is no better place than Zug, Switzerland.
Bonus point that most people do not know about Zug: It is ideally located between vibrant global cities like Zurich and Lucerne while simultaneously giving you access to some of the best nature for hiking, swimming and skiing in the world. Since Zug is not only a hub for crypto companies but for any type of company that values low taxes, the canton is rich in resources, which it happily uses to organize many events throughout the year to improve the quality of life for its inhabitants.
