Liechtenstein

Important Aspects	Details about Liechtenstein
Specific rules for asset issuance	Liechtenstein has the Token and Trusted Technology Service Provider Act (TVTG), also known as the Blockchain Act, which regulates the entire life cycle of crypto assets. The Financial Market Authority (FMA) oversees the issuance, ensuring proper compliance with set requirements and registration processes. All services related to digital assets must meet certain standards, including those for token issuers, generators, and custodians.
Clarity over resale of digital assets	The resale of digital assets is governed by the Blockchain Act, which ensures legal clarity for ownership transfers. If the token is a financial instrument (e.g., a security token), resale must follow EU regulations like MiFID II, with specific requirements based on the type and volume of the transaction.
Clarity over trading restrictions	Trading restrictions depend on the nature of the token. Security tokens are subject to MiFID II rules and may require a prospectus for public offerings. Utility and payment tokens can be traded on non-MiFID licensed exchanges but must adhere to the regulations of the Liechtenstein Blockchain Act. The FMA supervises crypto exchanges and secondary market trading, particularly for financial instruments. Other restrictions include registration and adherence to AML/KYC requirements.
Custody of digital assets	Custody of digital assets in Liechtenstein is regulated by the TVTG, which defines roles for trusted technology (TT) service providers like TT token depositories. Custody services must be registered with the FMA, which requires service providers to adhere to standards for AML/KYC and due diligence. The exact conditions vary based on the type of digital asset and service offered, emphasizing security and investor protection.
Dispute resolution	The Princely District Court in Vaduz has jurisdiction over disputes involving digital assets. If a token issuer is seated in Liechtenstein, the court can handle cases related to ownership, transfer, or any disputes over the token's legal relation. Additionally, the Blockchain Act allows for token holders to seek the declaration of a token's invalidity in cases like the loss of a private key.
Promotion of digital assets	The Liechtenstein Blockchain Act and Prospectus Regulation govern advertising and marketing. For security tokens, promotion is subject to the Prospectus Regulation, where offering volume, target audience, and ticket sizes influence restrictions. For utility and payment tokens, the requirements of the Liechtenstein Blockchain Act apply, especially regarding the provision of a Basic Information Document (BID). The exact restrictions vary depending on the nature and class of the token.
Filing process for asset issuance	For issuing tokens, an entity must register with the FMA and, depending on the volume of the public token offering (PTO), fulfill requirements such as preparing a Basic Information Document (BID), KYC/AML compliance, and ensuring business continuity during the issuance. Offerings over certain thresholds (e.g., 1 million francs) impose additional capital requirements. The issuance process varies for different token types (asset-backed, debt-backed, utility, or payment tokens).
Takeaways for VASPs	1. Registration with the FMA is mandatory for providing services related to distributed ledger technology. 2. Adherence to AML/KYC regulations is crucial for preventing financial crime. 3. Entities must operate under the Token Container Model, allowing tokens to represent various assets. 4. For financial instruments, compliance with MiFID II and other financial market laws is required.
Takeaways for digital asset issuers	1. Comprehensive registration is required with the FMA for issuing tokens, including meeting capital and governance requirements. 2. Different rules apply depending on the offering volume and nature of tokens (security, utility, or payment). 3. Legal certainty is provided through the Token Container Model allowing token representation of any right. 4. Issuers must prepare a Basic Information Document for public offerings. 5. Liechtenstein law applies to all tokens issued by entities based in the jurisdiction.