Despite the efforts already made, we still need to work on improving the competitiveness of the Swiss financial centre. In other words, we can’t just rest on our laurels – the competition is global. It is therefore important to be able to enjoy regulation that protects investors and the integrity of the financial centre, as well as providing favourable conditions for companies and innovation.
…we can’t just rest on our laurels – the competition is global.
The Swiss authorities have taken a proactive approach over the last two years. The fintech report from the Federal Council in November 2016 allowed the introduction of a new category of banking licence, the “fintech licence”, which came into effect at the start of this year. In December, the Federal Council also published an influential report into the legal framework for distributed ledger technology and blockchain in Switzerland.
Our authorities have rarely shown such determination in their desire to encourage the development of expertise at both national and international level in order to create the conditions for Swiss champions to emerge. But time is pressing and competition is fierce.
But time is pressing and competition is fierce.
The role of Switzerland and Geneva
It is crucial to strengthen the relationships between private and public-sector players (political and regulatory authorities, banks, technology companies and the academic world) to draw up agendas that promote common interests, ensure top-flight training and stimulate the innovative capacity and technical expertise that has always been Switzerland’s strong point. Specifically, four areas need to be studied:
At the international level, Switzerland has to take the initiative to ensure global blockchain standards are adopted early, making use of its proximity to international and non-governmental organisations based in Geneva.
It would also be wise to ensure a steady pace is kept up in the evolution of the regulatory process in Switzerland. The recommendations and suggestions in the Federal Council report of 14 December 2018 should be implemented rapidly.
Our regulator FINMA also needs to be able to pick out high-quality projects rapidly and issue them licences within a reasonable time frame – here too, competition is global and talent is highly mobile. Other regulators have put rules in place which guarantee a rapid turnaround of completed applications.
Finally, in terms of financing, our most promising start-ups find it hard to raise significant amounts of capital. The recent creation of a CHF 500 million investment fund to support innovative SMEs promised by the Federal Council is a reassuring sign. It would indeed be a shame if our stars were bought out by international giants or shifted their activities abroad.
The role of Geneva
The region has everything needed to develop industrial applications based on blockchain that go well beyond cryptocurrencies. The Lake Geneva region boasts cutting-edge skills in financial services, technology and regulation, demonstrated by the participants in the first Geneva Annual Blockchain Congress held at the end of January.
The region has everything needed to develop industrial applications based on blockchain that go well beyond cryptocurrencies.
Traditional financial assets and digital assets will only come together if the highest institutional standards are applied across all levels of the value chain. Switzerland and Geneva have a major part to play.