How could Switzerland and Singapore establish themselves as centers of the crypto and blockchain industry?

Several countries are trying to create a welcoming environment where crypto companies can establish themselves in their territories.

For these governments, it has a number of benefits to get these companies located in their countries: the opportunity to conquer some of the value of a thriving market, and more importantly, the creation of a center for startups that may become the equivalent of 21st century Silicon Valley.

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The crypto landscape is constantly changing: a few years ago, Estonia and Malta were among the countries favored by crypto companies. Today, Singapore and Switzerland are on their way to to impose as the global centers for the crypto and blockchain industries.

Singapore:

Singapore is fast be one of the most important financial centers in Asia. Many crypto companies have taken up residence in Singapore: KuCoin, Cyber ​​network, CoinGecko, Zilliqa, Engine, Aelf… Just to name a few.

Not surprisingly, the cryptocurrency adoption curve is steeper in Singapore than in other nations, according to a study by the cryptocurrency exchange Independent reserve from the Asia-Pacific region. 93% of respondents said they had heard of Bitcoin. Nearly 40% of respondents described BTC as an “investment asset”, and 25% called it a “value store” or digital gold.

Adrian PrzeloznyCEO of the Independent Reserve, has describe Singapore as a “key hub in Asia because of its robust and well-regulated financial market infrastructure and its openness to new technologies.” In addition, the country spares no effort to fund fintech and encourage groundbreaking innovation.

Raks Sondhi, CEO of the Independent Reserve, Explain Singapore benefits in more detail in an email to Cointelegraph. According to him, many exchanges and blockchain companies are looking for regulatory security. This is exactly whatMonetary Authority in Singapore (the country’s central bank) with the Payment Services Act.

Singapore has applied its laws governing financing more broadly to the crypto sector, providing the same access to dispute resolution and a legal framework for the operation of crypto companies.

Another important detail is that Singapore is one of a handful of countries where the capital gains tax on crypto income is zero.

Switzerland

Switzerland benefits from its historic position in the traditional financial world, which it has relied on to establish itself as a key player in the crypto sector. Its stable political environment, its financial sector, its openness to foreign companies and its tax rate among the lowest in Europe have made it a country attractive for large companies and startups.

filecoin, Tezos, Solana, Polka dot, ShapeShift, Nexo, Cardano, Definition, Lisk, Decent, Cosmos and of course Ethereum all based their activities in Zug, an administrative region known as the “crypto valley”. It is also one of the few cantons where it is possible to pay local taxes in cryptocurrencies.

Switzerland clarified its position on cryptocurrencies very early on compared to other countries by adopting a number of important laws specifically aimed at them. Tax rules applicable to financial securities is close to the rules of taxation of cryptocurrencies. In particular, it should be noted that gains on the sale of securities in private assets do not give rise to taxation. On the other hand, business transactions are taxable as a lucrative business. It is important to note that there may be differences in treatment depending on the canton, a detail to consider for those wishing to establish their businesses in the country.

In September 2020, the Swiss Parliament unanimously approved the adoption of the law on distributed electronic ledgers (the “Blockchain Law”). It defines the conditions for crypto-trading and exchange management under Swiss law: these include requirements in the form of ICO, AML (anti-money laundering) and CTF (counter-terrorist financing), from which a token can technically be transferred to blockchain infrastructure. The law, which went into effect earlier this year, allowed cryptocurrencies to tokenize stocks, bonds and other financial instruments. The legislation could open the doors not only for decentralized financing, but also for the creation of shares in digital companies.

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