Liechtenstein continues to lead blockchain regulation even though it is one of the world’s smallest countries.
The country has continued to draw attention from European and international crypto communities since implementing the Token and Trusted Technology Service Providers Act (TVTG) in 2019.
A pioneering step
The TVTG created a regulated framework for token-related services, making Liechtenstein one of the first countries globally to enact legislation to regulate the crypto and blockchain industries. A growing number of crypto service providers have set up shop in Liechtenstein following the implementation of the TVTG, drawn by the optimal conditions offered there.
The recently passed Markets in Crypto Assets (MiCA) regulation continues to be questioned due to its incompatibility with Liechtenstein’s blockchain law despite the country’s progress. With 517 votes in favor and 38 against, the EU Parliament passed MiCA on April 27, hoping to lower the risks for consumers buying crypto assets and hold providers accountable if they lose investors’ crypto assets.
A model for registration
Director of the Liechtenstein Office for Financial Market Innovation and Digitalization, Dr. Thomas Dünser explains that MiCA is an important step toward establishing a unified regulatory system in Europe, taking cues from the TVTG, which served as a model for the legislation. As adopted from the TVTG, the MiCA draft includes a token container model, licensing requirements for blockchain-related services, and public offering information requirements. As a result, after MiCA takes effect, there should be a few changes to existing practices in Liechtenstein, and both laws will be compatible.