The Government Council of the Canton of Zug plans to invest nearly 40 million Swiss francs over five years as part of the "Blockchain Zug - Joint Research Initiative." The project is a collaboration with Lucerne's Universities, aiming to establish the Crypto Valley as a center for blockchain research.
The Zug cantonal government has proposed to the Cantonal Council to establish an Institute with nine chairs at the University of Lucerne and to enhance the existing research activities at Lucerne University of Applied Sciences and Arts, as announced in a German press release by the canton. Additionally, a collaboration and communication platform will be created as part of the "Blockchain Zug - Joint Research Initiative."
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The Crypto Valley - a crypto hotspot in the heart of Europe
The early establishment of blockchain companies in the Zug region since 2013 has led to the emergence of the term "Crypto Valley" akin to the "Silicon Valley." Switzerland has successfully built a thriving ecosystem for blockchain and cryptocurrencies, thanks to its proactive policies and regulations. Remarkably, the regulatory authority has been active in the global blockchain sector since 2015. Over the years, the region has witnessed the arrival of new companies and continuous advancements. Co-working spaces in Zurich and Zug have flourished, while Swiss universities have launched new initiatives to attract crucial programmers for the blockchain industry. The Zug cantonal government now aims to further support this dynamic.
"We believe that blockchain technology has the potential to transform many aspects of our lives, and we want to ensure that we are at the forefront of this change. By doing so, we further strengthen Zug as a business location, also because we are investing in areas that are already established in the Canton of Zug." - Heinz Tännler, Finance Director of the Canton of Zug
According to the long-standing public servant for Zug, the "Blockchain Zug - Joint Research Initiative" will create an innovative flagship project with significant impact. The goal is not only to focus on the technological aspects but also to anticipate the effects of blockchain technology on the economy and society. It is not solely about achieving technological progress, but also understanding how these advancements influence our society. This should ensure that the Canton of Zug maintains its leading position in the development of blockchain technology and gains international recognition.
Financing through supplementary tax in Zug
The joint research initiative will be supported with a total of 39.35 million Swiss francs in contributions from the canton over a five-year period. The project's funding will be entirely derived from supplementary tax revenues, which is a measure aimed at offsetting the challenges posed by the OECD minimum tax on the region of Zug. After the five-year period, the "Blockchain Zug - Joint Research Initiative" is supposed to become self-sustaining.
As of the end of 2022, the Crypto Valley was home to 1,135 companies with approximately 5,000 employees. Geographically, Zug is undeniably the heart of this ecosystem, with nearly half of the companies choosing to establish their headquarters in this Central Swiss canton. By complementing the strong business environment with a focus on scientific research potential through collaboration with Lucerne, the Crypto Valley's already robust position could gain further momentum, as an industry expert puts it.
"The initiative once again underscores the clear pioneer status that the canton of Zug has in the blockchain sector. An approval by the Cantonal Council would further strengthen the international competitive advantage of Switzerland as a crypto nation." - Hans-Jörg Morath, Head Product Strategy & Client Coverage at Digital Asset Solutions