Swiss AG vs GmbH: Choosing the Right Company Structure for Zug

The first structural decision any founder makes in Zug is also one of the most consequential: AG or GmbH. Both are private limited liability vehicles under Swiss law. Both provide limited liability protection for shareholders or quota holders. Both can be formed relatively quickly through a Zug notary and registered with the Handelsregister Kanton Zug. But the differences between them — in capital requirements, share transferability, administrative burden, and suitability for external investment — shape the long-term trajectory of a Crypto Valley company in ways that become costly to reverse.

This article provides the operational analysis founders need to make an informed choice between the Aktiengesellschaft (AG), the Gesellschaft mit beschränkter Haftung (GmbH), and the less common structures — the Stiftung (Foundation) and Verein (Association) — that serve specific purposes in the blockchain ecosystem.

The AG (Aktiengesellschaft): The Dominant Structure for Serious Crypto Valley Companies

The Aktiengesellschaft is Switzerland’s joint stock company — the equivalent of a corporation in the United States, a limited company in the United Kingdom, or an Aktiengesellschaft in Germany and Austria. It is the preferred structure for the leading names in Crypto Valley: Sygnum Bank AG, AMINA Bank AG (formerly SEBA Bank AG), Bitcoin Suisse AG, and CV VC AG.

Minimum capital: CHF 100,000. At least 50% (CHF 50,000) must be paid up at incorporation; the balance can remain committed but unpaid, subject to statutory rules. The minimum capital is deposited in a capital deposit account before the notarial founding act and released to the company upon commercial register entry.

Shares (Aktien). The AG issues shares, which are by default freely transferable. Bearer shares (Inhaberaktien) were effectively abolished by Swiss law reform in 2019; registered shares (Namenaktien) are now the standard form, with the owner recorded in a share register (Aktienbuch) maintained by the company. Restricted registered shares (Namenaktien mit Vinkulierung) can limit transferability, but this requires a specific statutory provision and board approval process.

Governance structure. The AG must have a board of directors (Verwaltungsrat) with at least one member resident in Switzerland. Shareholders meet at the annual general meeting (Generalversammlung) to approve financial statements, elect directors, and discharge directors from liability. A statutory auditor (Revisionsstelle) is required for larger companies; smaller AGs may qualify for an opting-out from the full audit requirement if all shareholders consent.

Why the AG suits blockchain and crypto companies. The AG’s share structure makes it far better suited to the equity investment dynamics of the crypto and tech sector. Convertible notes, SAFEs, and venture capital rounds all function naturally with shares: cap tables are maintained through the share register, new shares are issued via board resolution and shareholder meeting approval, and transfer happens by agreement of buyer and seller plus share register update. The AG can also be structured with multiple share classes (ordinary shares, preference shares) to accommodate different investor rights — though Swiss law is more restrictive than US or UK law on preference share mechanics.

The AG is also the required structure for FINMA-licensed banks and securities firms. If your roadmap includes a banking licence, securities dealer authorisation, or similar FINMA authorisation, the AG is not optional — it is mandatory.

The GmbH (Gesellschaft mit beschränkter Haftung): Simpler, Cheaper, Less Flexible

The GmbH is Switzerland’s limited liability company for smaller operations. It is administratively simpler and cheaper to establish than an AG, and appropriate for companies that do not need the full structural apparatus of the AG.

Minimum capital: CHF 20,000. Unlike the AG, the full CHF 20,000 must be paid up at incorporation — there is no option to have partly paid capital. The GmbH minimum capital requirement was reduced from CHF 20,000 (previously the same as the old AG minimum of CHF 100,000) as part of Swiss corporate law reforms; at CHF 20,000, it remains modest relative to the AG.

Quotas (Stammanteile). The GmbH does not issue shares — it issues quotas held by its members (Gesellschafter). The crucial distinction from AG shares: quota transfers require a notarial deed and must be registered with the commercial register to be effective against third parties. This is a significant practical limitation for external investment. Every time a quota is sold — in a funding round, a secondary sale, or a co-founder departure — you need a notary, a commercial register filing, and a waiting period. For early-stage companies with a stable founding team and no immediate investment plans, this is manageable. For companies expecting active investor activity, it is cumbersome.

Governance. The GmbH has a simpler governance structure: the Geschäftsführer (managing director) runs day-to-day operations, and the members (Gesellschafter) make major decisions in writing or at meetings. The GmbH does not formally require a board of directors, though it must have managing directors with signature authority registered in the commercial register.

Suitability. The GmbH is appropriate for: early-stage startups not yet expecting external VC investment; subsidiaries of larger groups (many international companies set up a GmbH as a Swiss subsidiary before establishing a larger AG operation); professional service firms; and operating companies in the Crypto Valley ecosystem that are not themselves seeking FINMA authorisation.

Key Differences at a Glance

For Blockchain and Crypto Companies: Which Structure?

The default recommendation for most blockchain and crypto companies with serious growth ambitions is the AG. The additional capital requirement (CHF 100,000 versus CHF 20,000) is not a meaningful constraint for companies operating in the digital asset space, where token sales, pre-seed funding, and founding team contributions routinely exceed that threshold. The structural advantages — freely transferable shares, clean cap table mechanics, compatibility with FINMA banking authorisation — justify the higher initial cost.

Choose the GmbH if you are at a very early stage and need the lowest possible establishment cost, if you are setting up a Swiss subsidiary of an existing international entity and do not need Swiss public company credibility, or if your specific business model does not anticipate external equity investment.

For token-issuing projects: both AG and GmbH can issue tokens, but the AG is strongly preferred because investor relations around the equity layer are cleaner. Many Crypto Valley projects use an AG as the operating company alongside a separate Stiftung (Foundation) for protocol governance — a structure pioneered by the Ethereum Foundation in Zug.

The Stiftung (Foundation): Protocol Governance, Not Operating Business

The Stiftung is a mission-locked, non-profit foundation entity under Swiss law. It has no shareholders or quota holders, no equity, and cannot distribute profits to founders. Its assets are permanently dedicated to its stated purpose.

The Stiftung is the structural backbone of the Crypto Valley protocol foundation ecosystem. The Ethereum Foundation, the Web3 Foundation (Polkadot), the Cardano Foundation, the Algorand Foundation, and numerous others are all organised as Swiss Stiftungen, typically registered in Zug. The Stiftung’s mission-lock is its feature, not a bug: it provides credibility that a protocol’s resources are genuinely committed to ecosystem development rather than founder enrichment.

The Stiftung is not an appropriate structure for operating businesses. It cannot issue equity, cannot participate in VC fundraising, and cannot be sold. Founders should not confuse the structural elegance of the protocol foundation model with a path to building a commercial business.

The Verein (Association): Industry Bodies and DAO Wrappers

The Verein is a democratic member-based association — the most associative of the Swiss legal forms. The Crypto Valley Association, the Swiss Blockchain Federation, and various other industry bodies are organised as Vereine. Some experimental blockchain projects have used the Verein as a legal wrapper for decentralised autonomous organisations (DAOs), though its suitability for this purpose remains legally contested.

The Verein is appropriate for: industry associations, community organisations, and non-commercial cooperative structures. It is not appropriate for commercial operations or external investment.

Establishment Process and Costs

Both the AG and GmbH require a notary (Notar) to authenticate the founding documents and articles of association (Statuten). The founding act is then filed with the Handelsregister Kanton Zug, which processes registrations typically within one to two weeks. Upon registration, the company is published in the Swiss Official Gazette of Commerce (Schweizerisches Handelsamtsblatt, SHAB), giving it legal existence and public notice to third parties.

AG cost summary:

• Legal counsel (articles of association, structuring advice): CHF 2,000–10,000 depending on complexity
• Notary fees: CHF 500–2,000
• Commercial register fee: approximately CHF 600–800 plus additional fees for complex structures
• Capital deposit account: typically CHF 200–500 account opening fee plus bank-specific charges; capital of CHF 100,000 released upon registration

GmbH cost summary:

• Legal counsel: CHF 1,500–3,000 for standard structures
• Notary fees: CHF 300–800
• Commercial register fee: approximately CHF 300–500
• Capital deposit account: CHF 20,000 fully paid up, typically lower bank fees than AG capital accounts

For blockchain companies in particular, engaging a lawyer with specific Swiss corporate and blockchain expertise adds significant value relative to using a general commercial lawyer. The purpose clause in the Statuten — which defines the activities the company is authorised to pursue — is particularly important for crypto companies, where overly narrow drafting can create regulatory complications later.

The choice between AG and GmbH is rarely the limiting decision for a capable Crypto Valley company. The capital requirements are manageable, the timelines are fast, and the Swiss commercial register system is efficient. The real decision is whether your business is building for institutional-grade operations and investment — in which case, the AG is the only serious answer.

For the full step-by-step process of registering either structure with the Handelsregister Kanton Zug, see the complete guide to incorporating in Zug. Founders building a group structure should also review how a Swiss holding company in Zug can sit above an operating AG to capture the participation exemption on subsidiary dividends. For the banking challenges specific to blockchain and crypto entities at formation, the crypto company banking guide covers the capital deposit account process at Sygnum and AMINA in detail.