Overview

The Swiss Foundation (Stiftung) is arguably crypto's most established legal wrapper, full stop — the Ethereum Foundation, Cardano Foundation, Web3 Foundation (Polkadot), and DFINITY Foundation are all Swiss foundations, most of them seated within a short drive of Zug. Governed by the Swiss Civil Code (Art. 80–89bis ZGB) rather than company law, a Foundation has no shareholders or members — it exists to pursue a defined purpose set out in its founding deed, administered by a Foundation Board. That structure, combined with Switzerland's political neutrality and modern crypto-asset regulation, is what makes it the default choice for protocols that want their governance layer to sit outside any single founder's control.

Use Cases

Tax Status

This is the point where the Ethereum Foundation's reputation misleads people: Swiss Foundation tax exemption is not automatic. A Foundation only qualifies for federal and cantonal tax exemption if it applies to the cantonal tax authority and demonstrates a genuine public-benefit purpose — charitable, scientific, cultural, humanitarian or comparable. A Foundation set up purely to govern a protocol's token or treasury, without a public-benefit purpose in its deed, does not automatically qualify, and is taxed like any other Swiss legal entity: 8.5% federal on profit after tax, plus a cantonal rate (around 11.9% combined in Zug for 2026). Whether your Foundation's purpose can credibly support an exemption application is exactly the kind of structuring question worth raising with us before filing, not after.

Legal and Governance

A Foundation is created by a founding deed defining its purpose and endowment, then registered in the commercial register — it exists as a legal entity from that registration, administered afterward by a Foundation Board (Stiftungsrat) rather than shareholders. Swiss law sets no fixed statutory minimum endowment, but supervisory authorities apply a practical threshold of roughly CHF 50,000 as evidence the founder is serious and the purpose achievable — foundations with capital-intensive purposes are expected to fund proportionally more.

Foundations confined to a single canton are supervised by that canton's foundation supervisory authority; those active nationally or internationally — which covers most crypto/Web3 foundations — fall under the Federal Supervisory Authority for Foundations (ESA). In practice, supervisory authorities expect at least one Foundation Board member resident in Switzerland, which is why a Local Physical Director or Supervisory Board service is bundled into our Protocol and Currency packages.

Privacy

The Foundation's purpose, endowment, and Board members are filed with the commercial register and are part of the public record — a Swiss Foundation is not a privacy vehicle in the way an offshore structure can be. Beneficiaries of a public-benefit Foundation are not typically named individuals in the way shareholders would be. From 1 October 2026, Switzerland's new Transparency Register also extends beneficial-ownership reporting obligations to legal entities more broadly — we'll confirm the exact scope for Foundations as implementing guidance is finalised.

Onboarding

Once your package is ordered, you'll receive a confirmation email with an invitation link to the Otonomos Dashboard, where you'll complete the Foundation application form, covering:

• Foundation name options
• Purpose of the Foundation
• Endowment amount and source of funds
• Foundation Board composition (natural and/or corporate participants)
• Nominee Participants (if applicable)

KYC Verification Process

After the application form is submitted, all natural participants — Board members and any Senior Managing Officials — receive a KYC invitation via SumSub to upload certified ID, proof of address, and a source-of-wealth declaration.

Constitution and Bylaws

For our DeFi/Blockchain Protocol and Digital Currency Foundation packages, we coordinate the legal drafting of the Foundation's constitution and bylaws to reflect a genuinely decentralized governance model — the same category of work that underpins how existing protocol foundations separate day-to-day development from community governance.

Time to incorporate

Incorporation generally takes 1–2 weeks from the completion of client onboarding, provided KYC clears without delay.

Entity Maintenance

Keeping a Swiss Foundation in good standing means:

• Maintaining the Foundation Board, including any Switzerland-resident member required by the supervisory authority.
• Annual financial statements, reviewed at Board level.
• Ongoing supervision by the cantonal authority or the ESA, which can request reporting on how the endowment is being used to pursue the stated purpose.
• If tax-exempt: periodically demonstrating continued pursuit of the public-benefit purpose to keep the exemption.
• From October 2026: beneficial-ownership reporting to the new Transparency Register, scope for Foundations to be confirmed as guidance is finalised.

Renewal Periods

The Local Physical Director and Supervisory Board services renew annually, alongside registered office and government fees.

Reporting

Beyond annual accounts, a Foundation's principal ongoing obligation is to the supervisory authority overseeing it (cantonal or ESA), which is a different relationship than a companies-registry annual return — supervision is about the purpose being pursued, not just a filing being made on time.

Shutting down your entity

Dissolving a Swiss Foundation is not a routine strike-off. Because a Foundation exists to serve its stated purpose rather than its founder, Swiss law restricts changes to that purpose and dissolution to cases set out in the deed or approved by the supervisory authority, and any remaining assets on dissolution must generally go toward a comparable purpose — they don't simply revert to the founder. Budget for supervisory authority involvement, not just a filing, and talk to us early if winding down is on the table.

FAQs