A Recap of Zug's "Bitcoin Experiment" - Dolfi Mueller, Mayor of Zug

Transcript

[Music] hello and welcome to the blockchain and us we're pioneers and thought leaders talked about their journey in blockchain technology crypto assets and the token economy and I'm your host manuel staggers this episode has support from no official sponsor but from my very own the blockchain and us newsletter get an email from me every two weeks with a very short summary of new podcast episodes so you can immediately pick those interviews you'd like to listen to to stay up-to-date just visit www.cannainsider.com/careers ilk a city in switzerland with roughly 30,000

inhabitants and the first city in the world that adopted Bitcoin in 2016 as a means of payment for official permits dollfie has a degree in law and economics he is a licensed attorney and a teacher of law and economics at the cantonal School of Zook the city also has additional pilots such as an identity card on the blockchain and now to the interview many thanks Dorothy Miller for for being part of the show again that's a pleasure for me the last time we spoke was about a year ago at the beginning of 2017 for the blockchain and us documentary film we made an

interview there and you spoke mostly about the Bitcoin experiment that you were in the middle of with the city of Zook so would you just briefly explain what that what that experiment was was about yeah it was a very exciting story in our town it was about the year 2013 there was a kind of you for flying Souls landing here in souk there was these people from the crypto valley at they started here in souk and first how it is in switzerland we have been writing what they are doing

here and after certain time we thought okay maybe this can be part of future and we heard something about blockchain we heard something about cryptocurrency especially Bitcoin and so in May of 2016 we invited a student from the University and he explained us in short terms what's the difference between blockchain and Bitcoin all these things and we didn't understand everything but when we went to lunch we said ok let's start this experiment we will accept Bitcoin

for the souq immigration office not more than that it's not for paying tax it's just for these fees this or very small fees and this was the beginning I would say of a new period period of the history of sue in a way because the reactions were surprising if we never expected that nearly the whole world would be coming to sook people from magazines from TV stations networks coming here because I think Bitcoin blockchain this is a really complicated

thing nobody really understands what happens there but being sued we had a very easy story which nearly everybody can understand and that's why I think the Eco was so huge so basically the idea was that people could come and pay fees you know that they need for a permit or another parking ticket I think right now it's it's for a permit for living here for example if you are coming to sue for living here in sue you pay the fee it's a kind of entrance fee for the city of sue and instead of paying twenty thirty if 50 Swiss francs they would pay in a

fraction of a Bitcoin in a fraction of a great ganya and yeah so we got about in the end till now we've got about 50 payments it's not that much but on the one hand I must say all these people coming to sook which are interested coming to suit because they were working here and Krypto Valley they have a wallet with bitcoins in it and so it was usual that they pay it with Bitcoin and the older part is about 20-25 journalists they were very interested seeing what we were doing there and they

so it's it's really easy this peer-to-peer payment from wallet from the private wallets to the wallet of the city of souk and so yeah we worry about we had about 50 payments like this and at the moment it's it's not going on anymore because did the payment for for the transaction for the miners is too high that's why this business is not going on at the moment but we said ok we won't give it up we won't give it up maybe it's coming back and I think it's it's not a good message to to finish

this now maybe we got all the clients but I think the symbol impact was really huge and we don't regret that we have done this and but after that we made new experience then I think it was the beginning of this pioneer time a little bit and - and that's why people for example from the University of Lucerne they said we want to do something with you something new and this is the idea of a digital ID based on blockchain not in a centralized computer with all

these data problems we have we do it the VD are looking for a solution which we can keep the author serenity of everybody which owns such a ditch light so sorry to drop but this was an idea that came out of the of accepting Bitcoin so then yeah you thought there are other applications of blockchain technology let's explore them let's look at maybe ID and other things to come maybe so that that basically was the most most of the value that you got out of D we have that pilot yeah I think I sold okay these guys from the city administration of sook usually politicians but these guys are open for

such new ideas and that's what I said okay we wanna try this with you you are our partners for this and on the other hand we also had partners from private from the private side Newport for example and so we worked together for this and it was the same thing as we started which this Bitcoin acceptance we didn't ask our experts in the house we said okay it was a success first time we do it again and then we I think it was about June 2017 we informed our press in sook that we will do that but

in the end of the year then we really started the experiment and the first step was that we said okay now people of sook you can make such a ditch lady come to our immigration office make your application we check your name your identity and after that the starting was a little success because we have now at the moment more than hundred fifty persons from sook which have searched each lady and they have no you use cases so far but this is I think this is important for us

they can't do that only in a theoretical manner I think we have create you have to create benefit for the people of sook maybe with very simple use cases for example if you want to ramp the city back you only need this ditch lie denote more than that you don't have to make it oppose it it's enough if you have this Mitchell ID or for example if you want to rent a book in the city library or if you want to have public room from the city you don't need specialty anymore it's

enough having this ditch slightly different things like this and what I feel is that people from the city administration they also feel as pioneers and they say ok dole VI I want to help you to create new use cases and we have made kind of competition in the city administration we said ok people who bring the best ideas they can make this project somewhere in an Alpine hotel in Switzerland or as it's a kind of price takeout for for this work and yeah I think people are now really

enthusiastic about this we have also all the people not everybody feels like pioneer not everybody is so open but much more people than I expected they were really on the way now of this new city administration and so yeah it was a good experience and it really puts Duke on the map too I mean it was you showed me this map you know with all these world influencer cities and there's Zook as well with all other big cities and I mean you know I grew up in sweats of course I knew about sook but now when I go to America to China to other you know foreign countries they asked me

what is the situation like you know with cryptocurrencies in ensue and so I mean that was a fantastic play right to put soup on the map as was it's a kind of miracle really a member of the city of the City Council was in Italy they had problems with their car and somebody an old Italian lady came to my colleague and said how you are coming from soup you are we are from the Bitcoin Valley and okay it's a nearly impossible well but okay this is I think it's an idea which has to become bigger and bigger

it's an idea with great potential for future and and it's a good story it's a good story yeah it's a good story but it's also it's there's not that many places where you can do what you can do here right I mean there's many many international companies coming here and and incorporating their foundations here so that I think was also another pioneering thing so it's not not just a press story I think it's also it's also innovation is real it's real yeah that that's true for example Swiss government boomed is Rob Schneider Rambam Minister of Economy and his colleagues they say okay we want to become not crypto where we sue we

want to become crypto le Switzerland and they know it's important having good rules soft regulation I would say don't suppress what's happening and but on the other hand we have one really real problem here because banks banks are not really not really interested having these clients here in in Switzerland and so some of these startup firms have to get the

relationship to banks in Liechtenstein for example and I'd saying I think that's not a good sign it's not it's not a good sign but I heard now that the situation in in Switzerland the UK will be getting better because banks have made a step more in the right direction and so I hope that they won't kill usually there are all the reasons that something will be killed it's not the banks which already got it cannot be that banks are really responsible if this thing would fail and I think they feel the pressure a little

bit and and and and I I think it's getting better in our last interview you talked about that as well where you said you try to bring bankers from sook together with companies who deal with cryptocurrencies and there was a attention in the room in the sense right here's Edward they didn't really get on a common ground have you seen a change there or do you think it's gotten even worse yeah for example count on all bank of Duke says now you can see it also on the Internet we accept relationship to search firms but under certain conditions and now it

depends on the kind of condition and I would say part of these conditions or still to several it's too hot and and I think yeah they have to make it better now and but if the Minister of Economy in Switzerland says hi please that that's that's your task in the industries economy to do to give that that the people good infrastructure in the end so I think this hint this the saint is so important and anti calm they cannot suppress it order always academia deny yourself deny it does yeah

you can't deny it and you also said in our last interview is that these things are coming if we want or not so better get on board instead of losing out or missing the train or missing important learning lessons and innovation lessons that's it's true I say in the heart I'm a analogical person I'm in a way I'm too old for for being digital natives that's impossible but on the one hand it's so interesting and on the other hand it's as I always say if I'm afraid of something I really want to know what's happening and I

think this most main experience we made here ensue so okay make the step and after that yeah I feel much better now I feel much better now if I had denied it if I had if I would have said oh it's the risk is too high I think one of the best experiences in my life would have been I had missed this experience and did this would be in PA this would be a pity and it's I also I said it's the situation in the city administration is the same I think if

the bosses say just do that then also our staff will do the same thing and yeah that's really good experience maybe there is some risk also we can talk about risk reputation risk for example but I don't I don't feel that like this many as there are some people there are some people which are kind of reside Mira Cassandra Cassandra people but usually indeed the majority of people understands what you are doing and more

and more it's the same maybe two years ago it was so new and now that we have so many conferences here in suit I think they see hey that's not only a joke it's much more people coming from all over the world to casino of sook we don't have enough seats for therefore these people I say that that I think that's a part of future we don't know how big this part is and some ideas will disappear and quite you know maybe it's one of hundred firms or really successful but maybe this number um due

to this that is important for the whole world and that's that's what you feel at the moment I hope it will go on like this how long have you been in politics yeah the whole life I was a member of the city Parliament's for twenty years and now I remember that in the end I'm member of the City Council for 16 years so it's a whole life in this local politics OOP local politics of sook and yo we are talking about building schools about so always quarreling and this birthing about parking sites we need

more we need less of them and sometimes I think ok it's getting boring and in the year 2013 there are tables and a new challenge for us and we didn't we didn't miss it we we took the chance and I think yeah I'd really don't regret that what was it your idea with Bitcoin or or did somebody tell you or was it somebody else or who was that I think it really was the team of the city council because yeah we have got the information from the student after that we went for a lunch and somebody at the moment we left

the building of our City Hall somebody said hey why don't we accept that and I think I gave him the answer we do that and don't ask everybody else and five people said okay we will do that yeah fantastic it's fantastic story so you said before it's maybe one of the most exciting things you did as a mere I mean still yeah that's true yeah there are other very good moments for example we had important persons from 12 different religions in the world here and for example it was the number

three of the Vatican in Rome was he and they were sitting on the stairs of the soup casino these 12 guys together and I felt pretty well that's also a good moment because it shows souk is an open place and it's not by chance that they are coming here and they said then it's the second time in the world history that something like this happens really first time it was in OCC in Italy was easy and then sue yeah sounds good yeah pretty good did you grow up in sook did you always live here yeah has how

has how has it has changed you know for example I'm sure it changed quite a lot over over the course of your life but was there maybe an acceleration in recent years when you thought it was I think it was maybe a completely altered time in the year of 1955 when I was born here because it was just at the beginning of globalization and through seems to be a little bit pioneer because in the year 1930 1940 these poor people in sook they created this tax law tax law wait that

low tax rates but nobody knew that globalization will come it took an order it took second world war it took another 30 years and then sook was one of the first places in the world with this very good conditions and I think that's one reason because great companies have been coming to sook starting their business here in sook but it's also a challenge for two people because in this years we had a community like every town with 30,000 inhabitants its its provincial in

a way and now yet we have to make the step from death prevent charity to an urban situation and not everybody into can make these big steps and and so it's it's very important that the city government for example tries to keep the balance and so we say okay we are open for crypto valley but we are also open for tradition and community because we don't want to lose speed on the way to create to crypto really in a way they have to accept these types and they have more the idea that I have to tolerate

what you are doing here and I think they are on the way to that but what happened did you get complaints about certain companies or there are complaints there there always have been complaints for about markridge that's all this story say but there is a big difference between the years of 1980 because politics in Hooksett we are not interested what Marc Rich is doing here it's it's not necessary having transparency he knows what he wants to do and now we want to have transparency

about all these things because I think you know they have so much influence we want to know what they are doing and I say they accept this from us because because we really want to have this information it's not it's not only the longevity month which I your we request yeah we say ok this rich isn't here anymore then you're then you are working here you're part of our town and in such small cities information transparency is

everything so we can trust each to each other and yeah now it's getting better and that you're also demanding from the new crypto companies yeah that's yeah that that's where it's really important because if if there is a black box where they are living in I think souk people they will not really accept them because if they don't have trust and confidence to their to that people and that's right yeah they have to play our rules and not only their own rules but I see now it's much more people coming here and today

they feel comfortable here in soup that's also because private companies they are organizing for example conferences they are organizing this ecosystem of sook and it's good people I really like working together with with these people I have confidence to these people and so I hope we won't have any black sheep and so far I haven't made the experience to meet people which are criminal water that's

it's a kind of feeling in the stomach but maybe there are exceptions yeah you can't you cannot exclude this but I think it's better having a certain jaws to these people because it's not just money it's that they have ideas they really want to change the world and it's not only the thing to get rich and Richards it's more than that most of these people how important is that aspect the aspect of changing the world and you know this centralization paradigm how important is that for you yeah personally for me it's very

important because I say I'm a person which likes to be independent I don't like every case ok I'm on the top of the hierarchy of our tag but that's much better than being a part of this if you are on top and I think Switzerland is a country which is very democratic and very decentralized and that's why I'm the president of this of the city and you know blockchain is decentralized technology and it fits very well to

Switzerland and it fits specially to sue and it fits to me as a person yeah cool so it's like in philosophy almost that you're also subscribed to because that's what I felt when I made these blockchain interviews for this film that's what what attracted me to do them because these people had really had a fire in them they wanted to do something they wanted to change the world yeah and not just you know work for Apple or work for Google or yeah yeah there's all third chance for them and did that they are making teams here in suit that that also this ecosystem creates new teams new corporations people from Russia or working together

with people from Finland or and yeah and much more people are coming here and and I hope I hope this will going on because it's for - it's it's like like a present it's it's it's it's in a way it's I think it's it's a new energy for sook and we feel this energy and I hope they will stay for a long time I hope maybe the meet the hype can't go on for a long time but I hope we come to a point where we have a very normal development and so

maybe that's getting more quiet but why not that's good for me because the end of the year I will retire and I hope in five years when I'm retired then I will see it was something it was something happening here in sook and I was little part at the beginning of this of this new time and soon I think this this will be really good and I'm sure it will happen yes cool I hope so too I wish you all the best and and and I hope that's going to work out so thanks a lot less thanks so much for

joining us today more info on our guests and our sponsors isn't the show notes of this episode and on the podcast website the blockchain and ask.com to help people find this podcast it's important that you download subscribe and give it a top rating and review on iTunes or on the podcast platform of your choice I'm Manuel staggers and I thank you very much for listening [Music]