Yes, Liechtenstein can serve as a gateway to Europe for Swiss companies looking to offer crypto services in the EU. However, there are other options available, and the best choice depends on the specific business model.

Here is a synopsis of the question that centered an event held on Thursday night in Zurich: What opportunities arise for Swiss companies from the fact that the EU's Markets in Crypto-Assets Regulation (MiCAR), a crucial regulatory package for the cryptocurrency industry, is about to be adopted by Liechtenstein, an EEA member?

Disruptive Elements

The event was organized by Liechtenstein Finance, a platform representing the government and financial market associations of the principality, in collaboration with finews.ch.

«Blockchain and artificial intelligence are disruptive elements for the financial market and associated with challenges for all actors,» Prince Michael of Liechtenstein said in his opening address, placing the topic in a broader context. Clara Guerra, Head of the Office for Financial Market Innovations and Digitalization, pointed out that although the principality is small in terms of area, it is significant in innovations.

Pioneering Role in Crypto Regulation

This is true without reservation regarding crypto regulation. Liechtenstein was the first country ever to regulate crypto services in its Token and VT Service Provider Act (TVTG) – VT stands for «trusted technologies.» Guerra acknowledged that the pioneering role is also associated with doubts, setbacks, and risks, but due to the extent and pace of change, there is no alternative to claiming leadership in innovation.

Guerra also sees the office as a «time machine» that speeds up innovation processes in the essentially sluggish state structures – even in the agile principality.

Simplified Procedure

Thomas Nägele, lawyer and president of the CCA Trustless Technologies Association, regretted that MiCAR does not provide for a principle of equivalence for non-EU/EEA countries, meaning that proof of comparable domestic regulation does not help in the approval process. MiCAR will already come into force at the end of June for stablecoins and comprehensively by the end of the year.

Liechtenstein plans to adopt the regulation promptly, in January 2025. «With a Liechtenstein license, crypto providers will have access to the whole of Europe,» Nägele noted, also pointing out that according to MiCAR, there is a possibility of a simplified procedure for companies already licensed under national law for a certain period.

MiCAR Does Not Regulate Everything

He also emphasized that there are business areas that are not covered by MiCAR at all, such as Non-Fungible Tokens, Decentralized Finance, Staking, and Security Tokens, which are treated as financial instruments in the EU. Here, national or existing rules at the EU level remain relevant.

Andreas Glarner, Partner at MME Legal, also participated in the subsequent discussion moderated by Claude Baumann, founder and CEO of finews.ch. «MiCAR is stricter than the Swiss legislation, so Switzerland often serves as a hub for crypto companies and Liechtenstein as access to the EU.» Guerra confirmed that Swiss companies are indeed interested in passporting, i.e., obtaining an EU license through Liechtenstein.

The fact that Switzerland and the principality have been economically, culturally, and institutionally closely linked for decades, and the two financial centers are traditionally well connected, proves to be a great advantage even in times of challenges posed by groundbreaking technologies.