“It’s not about Bitcoin, but about dynamics,” says city president Dolfi Müller n-tv.de. A year ago, Zug was the first place to introduce Bitcoin cryptocurrency in public administration. But the Swiss are more about it. Zug has become the startup Mecca of the crypto scene. Anyone experimenting with the technology Blockchain, which stands behind the Bitcoin, is welcome. What the Internet is for information is the “block chain” for the transaction, Müller explains. Cryptocurrencies, Fintech, Insurancetech – there are thousands of exciting applications. Even the new e-Identity, with which the city recently advertised, is stored in this decentralized digital register. Fraudster in the crypt scene does not fear Müller.
n-tv.de: The canton of Zug is rich. There is a lot of real money. Why did the city council decide last year to accept the crypto-currency Bitcoin as a means of payment – and turn the 30,000-strong city of Zug into a crypto mecca?
Dolfi Müller: It was as if in 2014 a UFO with the Blockchain landed in Zug. At that time, the first Blockchain-oriented startup companies came to us and founded the Crypto Valley. Interest in big data and robotics grew. My four city council colleagues and I wanted to know how this currency Bitcoin and the blockchain technology work behind it. A student explained it to us. At the subsequent lunch we had the idea to accept payment in Bitcoin. The registration office has low tariffs, so it is well suited. The echo was surprisingly large. Half the world came to Zug. We were the first to risk this experiment.
That sounds like a solo move by the city council. Has nobody protested?
Some citizens of Zug have a bit of a feeling that their city fathers and mothers are crazy. But it’s important that we bring new thinking to Zug. We just do it, we said. If the UFO has landed with us, we will not hesitate and take the chance. Maybe the sympathetic E.T. in the spaceship in it, but maybe something bad. Nevertheless, we want to know what’s going on there. We have to go first.
And now all want to pay in train with Bitcoin?
In fact, only about 50 people have ever paid with Bitcoin at the registration office. People from the Blockchain scene, who want to work here and have Bitcoin in their electronic purse, can register with us – from mobile to mobile. In the city we have wine merchants, trustees, a dentist and a real estate trader who accept Bitcoin. That’s handy, but that’s not central to us. It’s all about the trappings, the dynamics.
What has changed in the meantime?
The crypto community has grown: there are now estimated to be over 60 blockchain startups. We have a firm that strives to locate it here – it offers so-called coworking spaces, offices or temporary desks where freelancers, project workers or founders can make cheap use of the office infrastructure and socialize. In the area is huge dynamics in it. Blockchain conferences are held in Zug, now a big one in November and next year, to which lawyers are also invited. There is a great need for regulatory action. The Bitcoin experiment has also started a technological avalanche with us. The Swiss Federal Railways will bring a self-driving bus to Zug, which will run on public roads. Since people can experience the technological progress directly. We are open to all new technologies.
What else is there?
This week we introduced the digital identity on blockchain technology. I’m the first to have such an e-passport. The key to the digital locker with my personal details now lies with the state. If he says, Mr. Dolfi Müller, who wants to buy something on the Internet, is really Mr. Müller, then that’s the case. This identity can be proven counterfeit-proof at every transaction. This is better than a paper passport. Mainframe computers can be hacked, blockchain not. The data is secure because it is distributed decentrally. We in Zug can guarantee: you are the master of your data, you decide what you give out.
You want to attract people with the e-identity to Zug?
We will only be able to inspire people if the city offers services that generate benefits. People need to feel that it is worthwhile for them. We already have ideas for the next one to two years. You could dial into the wlan with the e-identity. You could pay the fees in the parking garage, for the municipal bike rental or the library. In any case, you would only need to book via the mobile phone. Our Zug specialty is the Blockchain. A Swiss futurologist said: “What the Internet is for information is the blockchain for the transaction.” This has a lot of future potential.
Who manages the project?
It does not need giant strategies. Behind the experiment, there is no headquarters policy. The city does not have the capacity to take care of it. The whole thing is mainly organized privately. The investment company Lakeside Partners shows up here. For example, she is organizing a conference on insurancetech (e-insurances), which will take place next week. Insurancetech is one of thousands of blockchain applications. This includes, for example, a flight cancellation insurance as a smart contract. It works very simple: you pay the premium. If the flight is three hours late, it will be detonated and Blockchain will release the regress payment. There are no middlemen anymore.
And what role does the city of Zug play in this?
We create the framework conditions and act as role models. We do not have a big litter. We can not flick our fingers and then we have a Smart City that is a leader in the world in every respect. We will not be able to do it. We can only show an idea and take examples step by step. Courage for the gap and error culture, trial and error. The canton of Zug passed a tax law 70 years ago that was revolutionary. When globalization hit in the 1960s and 1970s, the place benefited greatly. But Zug is no longer cheapest in Switzerland. Now we promote the technological progress for us. Money is important, but quality of life too.
Do you monitor what is going on with you, who settles with you?
You mean what we do when the Ufo gets the warrior Klingons out of the Star Trek universe? (laughs) Wherever money, speculation and volatile currencies are concerned, it gets interesting for black sheep. But they can make something negative out of everything. Cash is the worst thing. It attracts more criminals than Bitcoin. I say, there are of course problems and disputes with us. Things happen that are not only beneficial to the reputation of the cause. You have to have a nose for it.
So, the evil aliens have not yet stormed the big buffet you’ve built? Or have you just not noticed?
There is a clatter in the private startup Tezos, which has made an initial Coin Offering, in which investors have exchanged bitcoin and etherums in the current equivalent of 650 million dollars in so-called Tezzies. Unfortunately, the equivalent in Tezzies is now zero dollars because the founders never spent Tezzie. Cheated investors have filed a class action lawsuit in the Superior Court of California. I do not want to downplay it. But the people I know here in the scene are generally idealistically motivated. This is not about the purse.
With Dolfi Müller Diana Dittmer spoke