Switzerland is looking to the future with a Bitcoin referendum. According to the business, at least 100,000 bitcoin and cryptocurrency fans in Switzerland could vote “Yes” to the referendum, providing a significant boost to its eventual ratification.
Switzerland has long been recognised as one of the most cryptocurrency-friendly countries, with many crypto-related businesses and institutions based there.
In September 2020, the Swiss parliament unanimously passed a law, the Distributed Electronic Registers Act, which allows cryptocurrency companies to tokenize shares, bonds and other financial instruments.
Zug, a small capital city in the same-named canton, has long been a major hub for crypto firms from all over the world. It has been dubbed “Crypto Valley,” thanks in part to a particularly favourable tax system. It has been allowed to pay taxes in Bitcoin and Ethereum in the Swiss canton for about a year now.
A referendum on currency sovereignty was held in June 2018, when almost 500,000 Swiss voters voted in favour of a financial system that was no longer regulated by banks. This vote prohibited banks from electronically “creating” money when lending above their cash reserves.
Many people assumed that the referendum was a clear support of the Bitcoin system. This is because it may have taken away the banking system’s monopoly on money creation, which, even in Switzerland, does not view digital currencies favourably.
The Swiss Banking Association’s communiqué at the time was strongly critical of the referendum’s outcome. In actuality, it had stated:
“The Swiss Bankers Association resolutely rejects the full-money initiative. The existing monetary and financial system offers undeniable advantages and has proven to work very well in the service of people and the economy.”
Even the Swiss banking system appears to have changed its mind on cryptocurrencies in the last two years, as numerous financial institutions have opened up to trade.
The Crypto Market Index Fund, the country’s first crypto investment fund, was approved by the Swiss Financial Market Supervisory Authority (FINMA) in September. This means that Swiss mutual funds will be able to provide direct exposure to cryptocurrency-related securities to its clients.
Switzerland was one of the first countries in the world to support a cryptocurrency regulation law. So, if granted, this next vote might be a significant step forward in the country’s mainstream adoption of cryptocurrencies.