Crypto Valley Zug: blockchain businesses and their legal framework

Read the PDF edition (3 pages)

Zug is closely associated with blockchain and digital assets, and the term "Crypto Valley" has become a recognised label. Behind the label lies a federal regulatory framework that applies throughout Switzerland. Anyone launching a blockchain project in Zug should understand this framework before making commitments to investors or users.

How Crypto Valley developed

From the mid-2010s, a number of blockchain projects and foundations chose Zug as their seat. The canton and the city signalled openness towards the new technology, and a community of developers, entrepreneurs, lawyers and auditors formed around them. Today, blockchain businesses are spread across several Swiss cantons, and "Crypto Valley" is often used for this wider Swiss ecosystem.

FINMA's guidance on initial coin offerings

In February 2018, the Swiss Financial Market Supervisory Authority FINMA published guidelines on how it treats enquiries concerning initial coin offerings. FINMA distinguishes between payment tokens, utility tokens and asset tokens and assesses each token according to its economic function. Depending on the classification, securities law, anti-money laundering rules or banking law may apply. Hybrid tokens are assessed according to all relevant functions. FINMA has since supplemented its practice, for example regarding stablecoins, and projects should always consider the current position.

The DLT legislation

Switzerland adapted several federal laws to developments in distributed ledger technology. The changes entered into force in 2021. They introduced ledger-based securities that can be transferred on a blockchain, clarified the treatment of crypto-based assets in bankruptcy and created a new licence category for DLT trading facilities. This legislation is federal and applies regardless of the canton in which a company is located.

Foundations in token projects

Many early token projects used a Swiss foundation as the issuing or governing entity. A foundation has no owners and is bound to its purpose as defined in the deed of foundation. Swiss foundations are subject to state supervision, which for foundations with an international purpose is usually exercised at federal level. Supervision covers whether the foundation's assets are used in accordance with its purpose. A foundation is therefore not a flexible commercial vehicle, and its suitability should be examined carefully against alternatives such as a company limited by shares.

Banking and compliance

Access to bank accounts remains a practical challenge for blockchain businesses. Banks expect convincing anti-money laundering processes, transparency regarding token holders and investors, and a clear regulatory analysis. Projects that have obtained a qualified legal assessment usually find the process easier.

What pays off in practice

Classify the token first. The regulatory analysis determines licensing, documentation and marketing.
Choose the vehicle deliberately. A foundation, a company and a combination of both have very different governance consequences.
Plan anti-money laundering compliance. Affiliation with a self-regulatory organisation or a licence may be required.

How Ressos Legal helps

I advise blockchain and digital asset projects on Swiss structuring, regulatory classification and dealings with banks, drawing on experience with digital assets since 2017. Contact me for a first conversation.

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of October 2026.

English

Contact

Dr Alexander Ressos, TEP

Rechtsanwalt/Attorney-at-Law

I am a Swiss attorney-at-law and also admitted as a solicitor in Hong Kong and in England & Wales, with almost 25 years of experience.

Together with my multilingual team, including Chinese, Japanese, Korean, Russian, Ukrainian and French native speakers, I advise companies and their owners from around the world on the full range of banking, corporate, commercial and tax law matters in Switzerland, including international tax planning, fiduciary services, and legal family office services including immigration & relocation or real estate investments. My practice has a particular focus on clients from growth and frontier markets in Greater China, Central Asia and the Caucasus, the rest of Asia, the Middle East, Africa and Latin America, and I equally advise clients from Europe and North America. Through an affiliated Swiss trust company, we also take care of the incorporation and ongoing administration of their companies and other structures, including accounting, tax returns and corporate secretarial services, and I serve as a professional director where required. With the support of a network of first-class cooperation partners, I also implement solutions worldwide.

My approach is to act as a trusted advisor who works directly with decision-makers, on an equal footing: I start from what you want to achieve and shape every structure, contract and tax decision around your commercial goals and how it improves your after-tax return. As “lawyers who make it happen”, my team and I stay involved until your company is set up, your structure is in place and your transaction has closed, and we remain available for any follow-on work that may be required. You benefit from bespoke solutions and personal attention, and sound, friendly and practical advice. We are not the lowest-cost provider in the market, nor do we intend to be; our aim is to deliver well-founded, proper solutions and excellent value for money.

Get in touch →