Despite the onset of the “crypto winter,” a recent survey indicates that the cluster of companies working with digital currencies and related technologies in Switzerland’s Crypto Valley has expanded.
The declining prices of crypto assets in recent months have affected major blockchain and crypto companies with offices in Liechtenstein and Switzerland. The top 50 witnessed their valuation slump from $44 billion to $20 billion in Q4 last year, per a report by Zug-based investment firm Crypto Valley Venture Capital (CVVC), Strategy&, PwC, and Swiss IT consulting company Inacta.
However, the number of crypto businesses that have established a presence in the region spiked by about 20%, from 629 to 750. Meaning, more than 120 new cryptocurrency entities have registered in Q4 last year. It includes some of the most prominent names in the industry, four of which are billion-dollar unicorn startups.
The researchers have estimated that on average, the top 50 firms are valued at $400 million apiece. When the five biggest are removed from the equation, the average figure remains $365 million, which shows a low concentration. The study indicates that four entities are valued at more than $1 billion—Ethereum, Bitmain, Dfinity, and Cardano. Also, the average valuation of all 750 firms was estimated at $27 million.
The top 50 companies employ roughly 480 individuals in their Liechtenstein and Switzerland offices, while the entire sector employs more than 3,300 people. These and other figures in the report show that the present situation is “business as usual” for several entities, despite most digital currencies’ drop in market value.
The authors have also discovered that the Crypto Valley is expanding geographically. While 51% of the companies are headquartered in Zug, other Swiss cantons are already home to the rest. Based on the compiled data, 39 of these businesses are registered in Ticino and 42 in Geneva. Another hotspot is Liechtenstein with 38 firms from the industry. CVVC maintains a digital map displaying the locations of crypto startups.
A comparison with the figures from Q3 of 2018 indicates that 15 firms have joined the top 50 over the last three months of the past year. These include 4 Artechnologies, Nexo, Zulu Republic, Icon, Token Pay Swiss, Utopiamusic, WPP Energy, Sygnum, Quant Network, Santiment, Saga, Odem, Mt. Pelerin, Hdac, and Boscoin. Ten other startups are candidates to do so in the future.
Liechtenstein and Switzerland, along with the Isle of Man, Estonia, Malta, and Gibraltar, are part of a group of European jurisdictions that make efforts to establish a crypto-friendly business environment. The Swiss Crypto Valley expansion has been facilitated by the nation’s decentralized political system as well as strong traditions in offering financial privacy. Last month, the Bern government adopted a comprehensive strategy for the crypto sector’s development.