Tokenisation as a key future driver in Liechtenstein

With the Markets in Crypto-Assets Regulation (MiCAR) Implementation Act coming into force on 1 February 2025, Liechtenstein is establishing itself as a gateway for crypto assets from Switzerland to the EU.

The TVTG creates the basis for secure and sustainable tokenisation solutions. With the entry into force of the MiCAR Implementation Act on 1 February 2025, Liechtenstein is once again sending a strong signal in the area of blockchain regulation.

MiCAR: Market access to the EU and the EEA

Liechtenstein’s membership in the European Economic Area provides service providers based in the Principality of Liechtenstein with simplified access to the EU/EEA single market. Swiss companies are also successfully utilising this fact by establishing a subsidiary in Liechtenstein. However, the real driver of innovation remains the Token and TT Service Provider Act (TVTG) – better known as the Blockchain Act – which was established in Liechtenstein back in 2020.

TVTG: Framework for tokenisation solutions

The TVTG creates legal certainty by defining tokens not only as cryptocurrencies, but also as digital representations of rights. This foresight allows tangible and intangible assets to be reliably and transparently mapped on blockchain systems. Companies relying on long-term solutions benefit from the stability and quality of this framework – core values that are also anchored in the DNA of the Liechtenstein financial centre.

Tokenisation of rights: Keyword ‘Real World Assets Tokenisation’

Tokenisation can be understood in two fundamentally different ways. The first method is based on an established model: a company is founded that acquires an asset – a painting, for example. Shares in this company are then issued in the form of tokens. The advantage of this approach lies in the fact that it is essentially a traditional financial instrument that is merely made more efficient and accessible in digital form. By using tokens as a form of issue, a recognised legal framework is used, which leads to greater acceptance among investors.

The second method, made possible by the TVTG, goes much further. In this case, property rights can be represented directly in the form of tokens without the need for an intermediary company. A painting can thus be mapped as a digital asset on the blockchain, whereby the token itself represents the ownership right. If the token is transferred, the ownership right is also transferred. This innovative approach opens up completely new possibilities for asset management and at the same time creates efficiency gains by pushing back traditional structures.

MiCAR and TVTG: a harmonious interaction

With MiCAR, many European countries now have a supervisory regime that regulates service providers and enables public offerings of tokens. However, the civil law principles are not regulated in MiCAR. And this may lead to legal uncertainty and, in extreme cases, to void transactions.

At this point, the civil law part of the TVTG creates the necessary legal certainty. For Liechtenstein, the combination of the TVTG and MiCAR not only means integration into the European single market and thus market access to 450 million customers and 23 million companies, but also a clear competitive advantage: while other countries are still struggling to find a legal framework, Liechtenstein already offers stable, tried-and-tested and legally secure solutions.

A location with vision and thinking in generations

Liechtenstein combines innovative legislation with political and economic stability as well as short distances. This unique combination makes the location particularly attractive for companies that rely on blockchain technology.

Liechtenstein combines the best of both worlds – thanks to its comprehensive market access to the EU and Switzerland, the country remains a hub for innovative solutions in the financial sector.

Dr Thomas Nägele, President of the CCA Trustless Technologies Association