Swiss Banks Deny Service To Blockchain Startups Despite Industry’s Strides

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Players in Switzerland’s cryptocurrency industry have difficulty accessing banking services which they need for the successful running of their businesses.

Swiss blockchain and cryptocurrency companies are demanding that they should be taken seriously by banks and that banks should make it easier for them to access banking services. The players argue that the cryptocurrency sector in the country has matured to a point where it should be recognized as a viable industry and hence deserving of the full benefits of banking. Speaking at the Crypto Valley Association (CVA) conference in Zug, Daniel Haudenschild, president of the association, said that all the negative factors and scams that surrounded the crypto industry in years past have died away and over the last two or three years, the industry has managed to produce mature products. He also said that big tech companies have come to the fore in the industry and this should be a sign that the industry has matured.

Swiss Blockchain And Cryptocurrency Market And Big Names Entering It

Facebook is the recent big name company to enter the Swiss blockchain and cryptocurrency industry. Project Libra, a cryptocurrency payments project which is being developed by Facebook and its partners, has its foundation set in Geneva. This gives a lot of credibility to the cryptocurrency sector in the country and players in the industry feel that banks should recognize this and ease restrictions that these companies face. There needs to be found a way to assist holders of crypto wallets in their bid to open bank accounts.

The blockchain industry in Switzerland has about 750 startups and support firms which operate in a wide range of industries such as legal and consulting. These firms struggle to execute simple procedures such as opening bank accounts despite the intervention of the Swiss Bankers Association on their behalf. Herbert Stechi, a Swiss blockchain entrepreneur, described the situation faced by blockchain startups as a “daily nightmare”. Startups in the blockchain industry have to resort to opening bank accounts in other countries such as Estonia and Portugal despite them being able to use cryptocurrencies as their capital in Switzerland. Startups can use the funds they gained through Bitcoin trading, for example, to get their business off the ground.

Switzerland Developing Into A Blockchain Hub

Despite the challenges faced by Swiss startups in their banking sector, the country is being seen as a possible hub for blockchain technology by industry stakeholders across the world. Other countries are interested in engaging with Swiss blockchain players to develop blockchain based solutions. Korea is one such country with the mayor of the Seocho district in Korea, Cho Eunhee, seeking to embark on a bilateral program that will see Korean developers building blockchain experiences in Switzerland and Swiss companies building their presence in Seocho.

Summary

The Swiss cryptocurrency industry is failing to engage with the banking sector due to the negative perceptions associated with cryptocurrencies and online crypto trading. Despite the growth of the industry and the engagement of big names in it, there is still difficulty in obtaining banking services. The crypto sector will continue to grow and Switzerland is becoming recognized as a hub for blockchain technology at the international stage. It may only be a matter of time before banks have to accept that the industry has matured and it is here to stay.

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About Ali Raza

A journalist, with experience in web journalism and marketing. Ali holds a master's degree in finance and enjoys writing about cryptocurrencies and fintech. Ali’s work has been published on a number of cryptocurrency publications.