Crypto Valley in Switzerland is asking the federal government for CHF 100 million (US $ 102.7 million) to curb the startup crisis.
Heinz Taennler, finance director of the Crypto Valley in Switzerland, Zug. He suggested that the fund could consist of federal guarantees, private investments, and contributions from local governments.
As a result, the Swiss Blockchain Association recently conducted a survey. The results suggest that the coming months are critical to the financial health of startups in the crypto ecosystem and will finally be able to stop the crisis.
A survey for Swiss Crypto Valley startups
Around 80% of the 203 companies surveyed warned of the impending bankruptcy. Only half of the 50 largest companies in Crypto Valley expect one year of business.
In the months before the corona virus crisis, Switzerland’s crypto valley had spread beyond the canton of Zug. But now many startups are at risk if market conditions don’t change.
As a result, 79.8% of Crypto Valley residents in Switzerland said that “they could go bankrupt in the next 6 months“” Another source said that only half of the region’s top companies will survive for a year. 88.2% will not be able to respond to the coronavirus crisis without government aid.
In addition, 56.9% of respondents were forced to fire employees last month. However, one of the most alarming numbers showed that 90.7% of startups are likely to have to take drastic measures in the future.
Some companies, such as Tend, had already started doing business without revealing much about their decision. The President of Switzerland’s Crypto Valley (CVA), Daniel Haudenschild, said:The center is a resilient community, whose members simply start a startup“”
The co-founder of the marketing company Relevance House, German Ramírez, also said that it was normal for 80% of startups in an industry to fail outside of the effects of COVID-19.
Ramírez predicts long-term success for startups. As a result, blockchain innovations are expected to disrupt traditional post-pandemic financial infrastructures.
The CVA president says the sector is already hardened by adversity. Mainly including freezing relationships with traditional banks that cannot be expected to provide emergency loans to companies.
While startups are generally at risk from the effects of COVID-19, the loss of venture capital from the Crypto Valley in Switzerland is a basic requirement.
What do you think about the financing needs of the crypto ecosystem at the moment? Your comment is very important to us.