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Switzerland
7.13 Rather Enabling Environment
Switzerland has recently become one of the main centers of the cryptocurrency industry. Its overall favorable taxation environment and other accompanying preferences enabled a number of bitcoin and blockchain companies to gain a foothold in this European region. Financial Market Supervisory Authority FINMA and the Federal Council openly welcome innovative startups while trying to contain the negative effects of the cryptocurrency boom and protect both the market and investors.
The canton of Zug houses the so-called "Crypto Valley Association", an organization (a-la "regulatory sandbox") whose main goal is to build the world's best ecosystem for blockchain and other related technologies. Numerous fintech and blockchain startup companies have opened offices here in recent years including Ethereum, ShapeShift, Xapo and Airbitz. The Lisk Foundation was registered in Zug in late December 2016. Zug is also the place of incorporation for the Tezos Foundation, which raised record-setting $232 million through an ICO as of August 2017.

According to CoinDesk ICO Tracker, the total amount of investments in ICOs within the first six months of 2017 exceeded $1 billion. Swiss companies account for one third of that amount ($370 mln).

The Swiss authorities are implementing blockchain technologies in public administration. In 2016, Zug became the first European city that accept Bitcoin as payment for utilities and other services on a regular basis. In 2018, Zug was announced to take a pilot municipal vote using the blockchain technology. The Zug authorities recognized the experiment as successful.
Neutral Political Environment
6.0 points
Issues related to the blockchain technology development and cryptocurrencies regulation are of great political importance to Switzerland. The Swiss political elites pin high hopes on cryptocurrency and blockchain-related business as an incentive to the development of the Swiss economy and demonstrate their friendly attitude to the industry by all manner of means.

The country has a consensus of political institutions concerning the importance of supporting the development of distributed ledger technologies and cryptocurrencies. And this consensus is rather positive. The political environment is stable and enabling for the development of businesses associated with blockchain and cryptocurrencies.
Rather Enabling Legal Environment
6.35 points
Regulatory Convergence
Switzerland has no comprehensive legislation that would regulate legal relations associated with blockchain projects and cryptocurrencies. Such relations are regulated by different state bodies. Supervisory authorities are roughly on the same page regarding this issue. The authorities adopt a consistent approach to blockchain projects and cryptocurrency regulation.

Definiteness of Legal Regulation
The corresponding legal relations are regulated by the current legislation of Switzerland exclusively, whose application to blockchain and cryptocurrency is detailed in decrees and guidelines by supervisory authorities. Such detailed explanations are made with due regard to peculiarities of blockchain projects. Therefore, despite the absence of special legislation, all spheres remain legally regulated by analogy.

The basis for the regulation of issues related to blockchain projects and cryptocurrencies was laid in 2014 in the report of the Switzerland's Federal Council, that defined legal status of cryptocurrencies but primarily aimed at defining situations when operations with cryptocurrencies fall under the KYC / AML rules. In 2018 FINMA published ICO guidelines.

Since Switzerland is a federal state, the legislation of cantons and municipalities may differ without serious contradictions, though; for example, the canton of Zug can boast more favorable taxation, while the authorities use the blockchain technology for government purposes.

Stability of Legal Regulation
The regulation in Switzerland had not changed since Council's report in 2014 until the Government reported to be taking steps to determine the legal status of cryptocurrencies. Only the FINMA ICO guidelines have been published so far, therefore, we believe that the law-making process regarding this matter is not completed.

Adequacy of Legal Regulation
In general, despite the fact that Switzerland has no special comprehensive legislation, the explanations given by the state bodies set a clear and understandable framework for the blockchain- and cryptocurrency-related businesses. Cryptocurrency and blockchain issues have received very adequate and progressive settlement.
Situation with the Rule of Law
Switzerland is not covered by the World Justice Project, therefore, RLI is not identified. The calculation of the Rule of Law Index is based on the average for the group of countries with similar environment for the promotion of democracy, human rights and freedoms, and rule of law in the Freedom in the World index (Freedom House). The Country Aggregate Score for Switzerland is 96 in the Freedom in the World index, therefore, countries with similar scores (Country Aggregate Score: 94-97) – these include Portugal, Andorra, Japan, Belgium, Austria, Chile, Estonia, Germany, Spain, United Kingdom. Average Rule of Law Index (World Justice Project) for this group is 0.77.

The conditions of the legal regulation of blockchain and cryptocurrencies are rather favorable, and since the values of the sub-criterion of the rule of law are high (0.77), the amount of the difference between weighted (multiplied by Rule of Law Index score) and unweighted assessments are not significant. This indicates low risks associated with the general conditions of compliance with legal safeguards in Switzerland.


Enabling Infrastructure Environment
9.04 points
Switzerland ranks 15th among 193 countries in the UN Global E-Government Development Index. Switzerland also has relatively high business environment development indicators ranking 33rd in the world.