Why Switzerland is a great country for cryptocurrencies
If you have not heard about crypto currencies by now, you must be living under a rock. And Switzerland is actually a global hub in terms of developing new cryptocurrencies and blockchain projects.
Why should you even care about crypto currencies?
I think there are at least two motivations why anyone should care:
Firstly, it is decentralized money: Banks and governments sometimes work to your advantage, but often they work more for their own advantage and not yours. In the case of central bank money, one could argue that they actively work against you, unless all your savings are in stocks and cryptocurrencies.
So having a decentralized alternative to bank and government-controlled money is a great thing in my view. Just remember how Switzerland, in itself being a small country, is highly decentralized and split up into its 26 cantons. But while Switzerland has a nicely local and decentralized governance structure for many laws, this does not apply to money. The Swiss Franc gets devalued by the Swiss National Bank in regular intervals to keep up, or rather keep its value “down” in accordance with the policies for the Euro by the European Central Bank. This is why stock prices have risen so much the last couple of years. Investors are fleeing the cash and seeking a „safe harbor“ in stocks of all places from their money being devalued.
This is bad if you have a lot of money (cash) on your bank account, in a safe or in your pension fund. The monetary policies of the last couple of years are a big punishment of all traditional savers.
Secondly, it may - speculatively - be a great investment in general: Since the central banks keep devaluing the big currencies to finance all the overarching government spending, COVID measures and so on, some cryptocurrencies like Bitcoin are more and more seen as something similar to gold. The famous „storage of value“. And similarly, more and more investors keep putting money into cryptocurrencies each month, because their hope is that cryptocurrencies will retain their value better than cash in the bank.
Don’t get me wrong, this is of course not sound or binding investment advice, which I could never provide. If you invest in anything I mention here, it is completely your own fault.
Why Switzerland is a great country to trade cryptocurrencies from
One of the benefits of Swiss tax law is that capital gains are typically free, if what you are doing is closer to investing than day trading. Make sure to check your individual case though, since most forms of frequent trading are not tax free.
So as long as you hold your tokens long enough, you might actually get all those gains completely tax free.
Another benefit is that Switzerland is one of the big hubs in terms of blockchain development. Many of the businesses and foundations behind major crypto currencies are headquartered in Zug or Zürich. This is why Zug has gained the nickname „Cryptovalley“.
So you will be in good company: There are meetups to join, the local tax authorities are generally friendly towards crypto and you could even start your own business around cryptocurrencies here.
In Zug, you can even deposit the capital for a limited liability company in Bitcoin and Ethereum.
This article is not financial, tax or legal advice by any means.
I am only sharing my own personal experiences here.
Always seek professional financial, tax or legal advice before making decisions.
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