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EU DLT Regulation: Liechtenstein’s Approach

In recent years, the European Union has been working to create a harmonized regulatory framework for Distributed Ledger Technology (DLT) across member states. Among these efforts is the EU’s proposal for a Regulation on Markets in Crypto Assets (MiCA), which aims to establish a consistent and proportionate approach to regulating DLT activities.

In this context, Liechtenstein has been actively working on its own legislative framework to regulate DLT. The country has recently introduced the Electronic Securities Act (ESA) and the Anti-Money Laundering Act (AMLA) Amendment, which provide a comprehensive regulatory framework for DLT activities in Liechtenstein.

Key Features of Liechtenstein’s Regulatory Framework

Licensing Requirements

To operate as a Token Issuer, Exchange Service Provider, or Crypto Custodian, companies must obtain a license from the Financial Market Authority (FMA). The licensing process involves an assessment of the company’s technical suitability, financial resources, and internal procedures.

Minimum Capital Requirements

Companies operating in Liechtenstein must meet minimum capital requirements, which vary depending on their specific activities. For example, Token Issuers with a issuing volume between CHF 5 million and CHF 25 million must have at least CHF 100,000 in capital.

KYC/AML Requirements

All licensed companies are required to implement Know-Your-Customer (KYC) and Anti-Money Laundering (AML) procedures, including the storage of KYC/AML data in Liechtenstein.

Supervision

The FMA is responsible for supervising licensed companies, although its supervision is event-driven or ad hoc rather than ongoing.

Industry Reaction

Liechtenstein’s regulatory approach has been well-received by industry experts, who appreciate the country’s efforts to create a clear and proportionate framework for DLT activities. “The new regulations provide a much-needed clarity for companies operating in Liechtenstein,” said [Name], CEO of [Company]. “We welcome the opportunity to work with the FMA to ensure compliance and maintain a high level of transparency.”

Outlook

As the EU continues to develop its regulatory framework for DLT, Liechtenstein’s approach serves as an example of how a small country can effectively regulate this rapidly evolving sector. With its comprehensive licensing requirements, minimum capital requirements, KYC/AML procedures, and event-driven supervision, Liechtenstein is well-positioned to attract businesses and talent in the DLT space while maintaining a high level of regulatory certainty.

“EU Proposes Regulation on Markets in Crypto Assets” (January 2023)
“Liechtenstein Introduces Comprehensive Regulatory Framework for DLT” (February 2022)

Contact Us

For more information on Liechtenstein’s regulatory framework for DLT, please contact [Name], [Email], or visit the FMA website at [website].