From Vitalik’s Water Walk to Swiss Crypto Perfume: The Journey Continues
While Token2049 in Singapore has become a huge conference, Switzerland`s role in growing today`s diverse and evolving Web3 ecosystem is critical.
Let’s not forget that until 2014, there was nothing else but the Bitcoin Blockchain and the cryptographic heritage of the cryptopunk community. At the time, the Bitcoin believers that actually included the co-founders of Ethereum were not attracted by the money (there was no money at the time) nor by any VC-funded hype.
As I watched the 10-year Ethereum celebration on the evening of 2nd day of the CV Summit at the Theater Casino, in a full auditorium, I realized how BOLD the Swiss ecosystem was at the time. They created a home for a bunch of young misfits and managed to infect a few important people with their vision. The first foundation was created in Zug and even though several of the eight original co-founders parted their own ways over the period from mid-2013 to mid-2015 (from tech creation all the way to mainnet and ICO), a decade later the Ethereum ecosystem is one of the strongest ones.
While the story of Steve Jobs and his co-founders starting Apple in a garage in 1976 has become a legendary part of Silicon Valley culture, the Airbnb rented by the Ethereum founders, Charles Hoskison writing on the windows, Herbert Sterchi`s jokes, former local Swiss director of Ethereum.
Amazing footage from the early days in Zug, the Ethereum Tree in Zug, to Vitalik walking on water…😉
The Crypto Nation has come a long way and this shows as the opening panel of the 2 day event was Bankers sharing their lessons from integrating Crypto Banking. The panel that I had the pleasure (although it was a Manel 😉) to moderate included Sygnum the first crypto licensed bank both operating in Switzerland and in Singapore and three Swiss banks, PostFinance, Luzerner Kantonalbank, Zürcher Kantonalbank.
PostFinance and Zürcher Kantonalbank together are significant Swiss banking players.
Zürcher Kantonalbank is the largest cantonal bank and the fourth-largest Swiss bank by balance sheet size and PostFinance is a leading financial provider serving over 2.5 million retail and business customers.
Post Finance started exploring Bitcoin as early as 2013! The challenge they faced is convincing their board and management to integrate the services from their innovation lab into the main business. Their retail crypto offering has finally been integrated into their main business in Feb 2024 and this is done through a partnership with Sygnum. Their campaign included a new perfume Le Crypt Eau
Zürcher Kantonalbank has chosen another approach which not only serves the crypto needs of their retail clients but all those of businesses. During the panel, they highlighted the learnings from their participation in Project Helevtia, as they foresee blockchain being the future of financial markets.
Project Helevtia: The cantons of Basel and Zürich, the cities of Lugano and St Gallen, as well as UBS and the World Bank have each issued a bond via SDX as part of phase three of Project Helevtia. Zürcher Kantonalbank, Banque Cantonale Vaudoise, Basler Kantonalbank, Commerzbank, Hypothekarbank Lenzburg, and UBS are the participant banks. The total value of transactions settled is about CHF 750 million.
Luzerner Kantonalbank even though smaller than the others, started their learning journey in 2016. The other Swiss cantonal banks see them as veterans in this space. For them it wasn’t FOMO that led them to start but rather customer needs. They persevered through major crypto crises, rapidly changing technologies (think of the evolution in L1 and L2, and oracles and other tech stacks that didn’t exist in 2016–2020) and regulations.
Clearly for the Swiss banking ecosystem “Crypto inaction is not an option”.
Post Finance just signed an MOU to participate in the recently announced Swiss Bankers Association’s deposit-tokenization initiative for 2025, along with UBS and Sygnum.
At the same time, Switzerland is being challenged by MiCAR the EU regulation around digital assets. In one of the workshops during the CV Summit, this topic was discussed in detail with a focus on the topic of Reverse Solicitation. Unfortunately, the rules are not 100% clear as always for Swiss service providers. On the one hand, it would seem that having an EU-licensed entity is the solution, however, the devil is in the detail. For example, a Swiss crypto provider may chose to have a German entity (get approval) for offering custody services. What happens when the EU client contacts the Swiss entity that offers additional services? Will the Swiss entity be in trouble with the German regulator?
The truth of the matter is that the EU regulator didn’t have the Swiss crypto ecosystem in mind when designing Micar but rather they had in mind how to protect EU citizens from Russian and Chinese crypto service providers (echoed by the workshop speakers).
The other insight is on the topic of whether Swiss-based crypto providers will choose EU jurisdictions that are crypto friendlier like France over Germany.
And the irony is that Digital Assets are caught in the midst of regulatory disharmony that persists and there is no reason to believe that this will change.
From Vitalik walking on water to a Crypto perfume by a Swiss regional bank traditionally serving through the Swiss post office, to AI agents in Web3; qualifies for a diverse trilogy.
Blockchain is the backbone of Web3 with its emphasis on decentralization and self-sovereign data ownership. The current advances in AI, bring to the forefront data ownership and many related topics as Tech Moguls like OpenAI are provoking us all with their shameless use of everyone`s data.
Heard at the CV Summit: Banks won’t open accounts to AI agents.
The NEAR protocol people said that, and I didn’t hear any banker in the audience stand up and argue against that. Seems to me that AI agents will have wallets and several self-sovereign wallet providers from the blockchain space are ready for that.
The blockchain innovators will be going after building primitives for decentralization at the Data Layer, at the Inference layer, and at the Computer layer.
An example of these new Web3 for AI or because of AI innovations is Vana. Vana Secures $25M to Empower User-Owned Data and Break AI’s Data Barrier
NEAR Protocol (NEAR) is the largest AI token by market cap, valued at $5.5 billion and it is ranked 18th among all tokens.
Conclusion (by Perplexity)
Switzerland’s pivotal role in the evolution of the Web3 ecosystem is a testament to its bold vision and innovative spirit. From the early days of Ethereum’s inception in Zug to the integration of crypto banking by major Swiss banks, the nation has consistently demonstrated leadership in embracing blockchain technology. The journey from Vitalik Buterin’s symbolic “walking on water” to the launch of a “Crypto Perfume” by PostFinance illustrates the creative and diverse approaches within this ecosystem.
As Switzerland navigates regulatory challenges posed by EU regulations like MiCAR, it remains a beacon for innovation, balancing tradition with cutting-edge advancements.
The convergence of AI and blockchain presents new frontiers, with initiatives like Vana and NEAR Protocol paving the way for decentralized data ownership. As we look ahead, Switzerland’s commitment to fostering a robust and dynamic Web3 landscape continues to inspire and shape the future of digital finance.
📌 Subscribe to my YouTube Channel with my insights and industry leader interviews. New video every Wednesday: https://www.youtube.com/EfiPylarinou
📌 Twitter: https://twitter.com/efipm
📌 Apple Podcast 👉 https://buff.ly/3P1Cp1Z
📌 Spotify Podcast 👉 https://buff.ly/3xPyWaV
📌 Linkedin: https://www.linkedin.com/in/efipylarinou/
📌 TikTok: https://www.tiktok.com/@efiglobal
