The next generation blockchain-powered internet, known as Web3, is a growth area for start-ups. In the race to attract the hottest new companies, Switzerland faces strong competition from the likes of Dubai and Singapore. We asked two Japanese start-ups why they chose Switzerland.
Overlay, launched by Takashi Oka, combines privacy and accountability. It supports the creation of the Decentralised Autonomous Organisations (DAO) – a digital system that allows groups of people, spread around the world, to control a company.
DAOs issue digital tokens, resembling cryptocurrencies, to fund their activities. The tokens also grant holders membership of the DAO and voting rights, replacing the concentrated decision-making powers of managers and boards of directors.
It is also possible to recruit new DAO members via social media channels such as Twitter. But Twitter doesn’t enforce Know Your Customer (KYC) rules, which are critical in the fight against money laundering. Overlay leverages an identity management platform from the Zug-headquartered Concordium blockchain to verify identities while preserving anonymity.
Oka explains why Overlay was registered in the Swiss canton of Zug at the end of August. “DAOs are characterised as being borderless networks, which fits well with the Swiss characteristic of neutrality,” he said.
He also considered Singapore, where life is easier for Asians, but decided against it because “it’s a centralised state where regulations are getting stricter all the time”.
As Oka went through the incorporation process, he also noticed other benefits. When he explained the project to Swiss investors, they immediately understood what he was talking about and asked him reasonable questions. “In Japan, I would first have to explain what blockchain is,” he said. “In Switzerland, investors are very well informed and communication with them is smooth.”
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