DeutschFor some laymen, the development came rather quietly, but for real industry experts, a clear trend was foreseeable: The small Principality of Liechtenstein has politically made it its mission to become one of the leading European nations in the crypto sector. It is not the first time that the country has reacted faster to developments in the financial market. Especially when it comes to taxation, the country likes to take unusual paths to make itself popular as a location for companies. After all, the small states have to somehow make themselves interesting for companies and entire economic sectors. This is also the case in the world of digital currencies and blockchain companies. For some time now, the country has been striving for the title “Crypto Valley” and, with its political direction, also wants to challenge Switzerland. Liechtenstein and Bitcoin – a country wants to move up:
Crypto Companies should be Even more Welcome in the Future
Switzerland – more precisely the canton of Zug – has held this name for several years due to a crypto-open political orientation. Only in October did Liechtenstein lay the next foundation stone with modern legislation that ultimately puts pressure not only on Switzerland, but also on Germany and the EU as a whole. At the Liechtenstein location, for example, well-known companies such as Aeternity expect increasing openness. The mini-state has earned a good reputation, especially as a licensor. Liechtenstein has also developed into an important starting point within a few years, the legal situation of which is discussed and partly adopted abroad. According to experts, the current “Blockchain Act” serves as a limited model for Germany’s blockchain strategy, which was developed by the federal government and should lead to the first digital bonds in 2020.
Liechtenstein Wants Even more Crypto Importance from 2020
Due to the small size of the country, Liechtenstein’s government can, according to many insiders, act faster than the larger neighboring countries. Not only startups in the crypto industry benefit from this, but especially investors and investors. Liechtenstein and Bitcoin – a relationship that fits.
The country is currently working on an innovative model that, coordinated with the applicable civil law, should enable transfers of tokens of various types. Trading in digital shares will soon be just as conceivable as the sale of real estate via blockchain or the granting of license rights. There is currently no such clear legal basis for crypto development. Bitcoin and Co. are wide open to us. Some analyzes currently speak of the first “holistic approach” for the crypto industry across Europe. The new jurisdiction is scheduled to come into force as an “Act” in 2020.
Numerous lawyers and industry experts actually believe that the Liechtenstein Blockchain Act has a good chance of becoming a model for other countries. Token developers and other companies are happy about it. Companies in many EU countries (and outside) have so far been looking for a clear direction for regulation in vain.
New Law should Allow the Industry to Grow Faster
With its “legal clarity” for the economy of the numerous tokens of existing and newly emerging currencies, the country also sees itself as a role model. The new “Token and VT Service Provider Act” (TVTG) is intended to offer crypto companies even more security than they already have. The exciting thing about the upcoming legal model: The Blockchain Act received no opposing votes in the Liechtenstein government. This, too, is to be seen as a signal for the openness of politics, which creates a good mood in the industry. At the provider Bitcoin Suisse, for example, it is said that the Principality will become the No. 1 blockchain and fintech location, at least in Europe, through the legal advance. Together with Switzerland, Liechtenstein, as part of the European “Crypto Valley”, now houses more than 800 companies that are active in the digital assets and blockchain sector.
Good Basis for Expansion of the Token Sector
If the upcoming legal situation starts as successfully as many analysts expect, many more organizations will most likely be added from 2020. With its reorientation, Liechtenstein is proving that it recognized the trend faster than other countries. If new forecasts are to be believed, token assets based on distributed ledger technologies (DLT) could account for 10% of global economic output by 2027. While other states are resisting the development as usual, the Principality recognizes the signs of the times. This is not just about entrepreneurial taxpayers who are to be lured into the country.
Liechtenstein also Recognizes Official Application Opportunities
The state itself also seems to want to take advantage of the high cost efficiency of the technologies. Tax returns, government securities and other interesting areas of application are also being discussed by the government and many authorities. Unlike their competitors in Germany, for example, Liechtenstein banks are also increasingly involved in the crypto sector. The renowned Liechtenstein bank Frick is one of many examples. Together with Bitcoin Suisse, the company is involved in the issuance of Bitcoin and Ether-based tracker certificates. Many more crypto products from the Principality are expected to follow from 2020. At the same time, the number of investors who open wallets, buy Bitcoin on exchanges and trade with altcoins is likely to increase noticeably due to the new regulation and security.
Liechtenstein and Bitcoin – more Well-Known Exchanges Appreciate the Location
Finally, three more examples that underline the crypto affinity of the small country. In recent months, a number of exchanges, such as the service provider Bittrex, have pushed into the Liechtenstein market. As in Austria, citizens in the country have had the opportunity since 2019 to exchange digital currencies in a Vaduz branch of the post office. In the start-up phase, BTC, ETH, Ripple, Bitcoin Cash and Litecoin were available. A project expansion was planned from the start. And something has also been happening in the education sector of the Principality for some time. As early as the end of 2018, the University of Liechtenstein announced a “blockchain course” as an innovative pilot project. The “Institute for Finance” launched a corresponding competence center at the beginning of 2019. Students are taught important know-how about the blockchain and the countless digital currencies.
Liechtenstein’s Financial Supervision Minimizes Bureaucracy
In this point, the country also serves as a role model for some other European countries. The enthusiasm for the new technologies in the small state has, as usual, a good reason. In order to compete with the larger countries in the EU, good ideas and openness to new markets are needed. The Financial Market Authority of Liechtenstein (FINMA) recognized this necessity early on and created the necessary framework conditions or paved the way for them with transparency and a willingness to discuss. Good official coordination without unnecessary bureaucratic pitfalls enables short reaction times, while the authorities elsewhere manage decision-making processes much more slowly. Liechtenstein and Bitcoin – This fits very well.
Part 1: Argentina and Bitcoin
Part 2: China and Bitcoin
Part 3: Russia and Bitcoin
Part 4: Germany and Bitcoin
Part 5: Austria and Bitcoin
Part 6: USA and Bitcoin
