Many small countries with flexible regulatory guidelines towards cryptocurrencies and friendly banking rules are pulling some companies away from some of the more established “havens” such as Switzerland.
Many in the industry have recently expressed concerns that Switzerland may be losing its “crypto-haven” tag, primarily because of current banking regulations in the alpine country. Thomas Moser, a board member of the Swiss National Bank, told Reuters recently that some fintech companies still had trouble opening accounts:
“They 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.”
This sounds like a less than genuine approach by the central bank as FINMA, the Swiss cryptocurrency-friendly regulatory body, continually has to deal with SWB’s continued concerns about money laundering.
Recent countries in the hunt for business are Liechtenstein and Gibraltar; elsewhere, the Cayman Islands and Bermuda are fast becoming start-up favorites, the latter recently when Bermuda shorts-wearing Changpeng Chao, CEO of Binance, announced he would open up compliance operations there and invest USD 15 million in the island.
Just in the last week, Bermuda’s Prime Minister David Burt, who also doubles as Minister of Finance, announced that 20 fintech companies had incorporated in Bermuda and another 21 were waiting in reserve. The list of 20 included Binance, Unikrn, iCash, Hub Culture, DES Digital Currency Exchange and Omega One with both Arbitrade Ltd and Arbitrade Mining (Bermuda) Ltd listed.
Bermuda has not only captured the world’s largest crypto company in Binance but, through its prime minister, has also expressed the desire “to position Bermuda as the incubator for this industry”, as Burt recently said at a New York blockchain conference.
The Rock of Gibraltar seems an unlikely place for a financial hub but nonetheless, it is, like Bermuda, fast becoming one, as it continues to lure new and existing fintech companies to its shores. Its second ‘Gibfin’ blockchain forum is on its way in September 2018, demonstrating the country’s serious intent when it comes to encouraging fintech companies to do business there.
Gibraltar is also about to finalize its cryptocurrency legislation which would allow companies to trade in digital currencies. Currently, 35 companies have applied for a government license.
Tiny Liechtenstein isn’t to be left behind either. The country’s proposed new Blockchain Law would take Liechtenstein down the “haven” route offering “crypto companies regulatory and legal predictability as well as enabling the country access to traditional fiat-based banking services”.
The law, originally scheduled for legislation on 10 July, is still on hold as the industry awaits further announcements later in the year.
Despite the obvious competition from these geographical minnows, Switzerland forges ahead regardless to become Europe’s cryptocurrency capital. Recent moves towards allowing cryptocurrency trading on its new SIX Digital Exchange is a clear notice of intent.
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