Switzerland plays a leading international role in safekeeping solutions for digital assets, with Swiss banks contributing significantly.
When it comes to the safekeeping of digital assets such as cryptocurrencies, tokens, and non-fungible tokens (NFTs), Switzerland is an international pioneer. Thanks to the clear regulatory framework, increasingly appreciated by professional and institutional investors after the numerous scandals and bankruptcies in the global crypto universe, first-class Swiss companies have established themselves in the market as providers of custody services.
As the world's digital vault, Switzerland is reinforcing its role as a global center of excellence in asset management. The first-ever «Swiss Digital Asset Custody Report 2023» published by «Home of Blockchain.swiss,» a public-private partnership launched by the Swiss Blockchain Federation, shows just how diverse the Swiss ecosystem is.
Banks are Expanding
The report, published in collaboration with the Swiss Bankers Association and the Asset Management Association Switzerland, among others, identified a total of 34 providers, including established players such as Bitcoin Suisse and Crypto Finance, as well as newer players such as Berner Kantonalbank (BEKB).
Traditional Swiss financial institutions have rapidly expanded their custody services for digital investment products in recent years and the number of their offerings increase significantly, the study shows. Almost half of the providers surveyed are banks, some of which also offer trading and staking services in addition to custody.
The spectrum ranges from retail and online banks like Swissquote to private banks such as Julius Baer and Maerki Baumann, universal banks such as Credit Suisse, and crypto banks Sygnum and Seba, to regional banks.
Swiss Innovation in Demand
Switzerland is also an attractive location for foreign financial service providers. Well-known firms like Spain's BBVA Bank, Fidelity in the US, or Bahrain's Arab Bank offer services for digital assets in Switzerland. In addition, service providers such as British Copper, whose chairman is the former British Chancellor of the Exchequer Philip Hammond, or the Israeli Fireblocks serve the growing Swiss market.
The fact that Switzerland is producing very innovative companies in the field of digital asset custody can also be seen in the acquisitions of foreign companies. With the sale of Crypto Finance to Deutsche Boerse and Metaco to US crypto giant Ripple, the Swiss ecosystem has shown that it's a global leader at the intersection of finance and technology.
Well-Filled Pipeline
With more Swiss crypto banking projects in the pipeline and new startups emerging, innovation in digital asset custody is accelerating in Switzerland, according to the study's authors.
Another indication of diversity, according to the study, is the customer base. Fifty percent of companies surveyed serve both private clients and professional and institutional clients, while just over a quarter serve professional clients exclusively.
Banks on the Winning Side
Following spectacular collapses such as Celsius and FTX, issues such as counterparty risk and transparency are high on the agenda of market participants. Professional and institutional investors are demanding services from regulated custodians.
Banks will benefit from this development as they will gain a large share of the custody business, Adrien Treccani, founder and CEO of Lausanne-based technology company Metaco, said this week at a panel discussion at the Point Zero Forum in Zurich.
