In the spring of 2018 the government of Liechtenstein announced that it is currently working on a law that regulates the blockchain technology (see full document here). In order to create a law which is sustainable, the government decided to not only regulate the blockchain ecosystem but extends the scope of the law to trustworthy technologies. This is because the regulators and the industry are not sure what the dominant design of this technology will look like. At the beginning of September, the long-awaited consultation process of the law was published in order to get feedback and inputs from the industry players in the Liechtenstein ecosystem.
This blog post will outline the most important points of the published draft, explaining its purpose and what it could mean for the future of the ecosystem.
In the last decade, the digitalization has resulted in a high dynamic in the overall economy especially in the financial industry. The Liechtenstein government is convinced that the future welfare of the country can be achieved with the continuous development of business innovation, especially in regard to the newly emerging technology of the blockchain.
For this, the Liechtenstein government introduced the regulatory lab headed by the financial market authorities (FMA) Liechtenstein. The regulatory lab is the central contact point for innovative business models that want to conduct their business based out of Liechtenstein. Because of the openness of the Liechtenstein government and the FMA, it was possible to develop a strong FinTech based ecosystem in Liechtenstein.
The Liechtenstein financial sector has a strong standing in the country and the aim of the new law is to establish a bridge between established institutions and new blockchain applications, especially in regard to the financial sector. It is of strategic importance for Liechtenstein to investigate this technology early in order to provide a regulatory framework and increase the regulatory certainty.