Boost your blockchain business

As one of the leading banks for regulated blockchain banking, Bank Frick has embraced Liechtenstein’s new Law on Tokens and TT Service Providers (Token and TT Service Provider Act, hereinafter referred to as the TVTG or the “Blockchain Act”; Gesetz über Token- und VT-Dienstleister, Token- und VT-Dienstleister-Gesetz, TVTG), which comes into effect on 1 January 2020. The future-oriented Blockchain Act creates legal certainty for TT Service Providers and clients, protects clients from abuse, and further strengthens Liechtenstein’s role as a globally renowned and innovative blockchain hub – laying the foundation for the upcoming token economy and further innovation.

Are you an established company, a start-up, an investor or a crypto exchange looking for a safe regulatory environment to boost your blockchain business? Then take advantage of Liechtenstein’s comprehensive blockchain legal framework to successfully implement your business idea and be part of the upcoming token economy. With its one-stop-shop approach, Bank Frick supports your plans and offers intermediaries trading and custodian services for crypto assets, assists with token sales and develops tailored crypto structuring solutions – take advantage of the consulting and regulatory expertise of the bank with the most blockchain experience.

Starting on 1 January 2020, professional market participants who want to do business as TT Service Providers and whose registered office or place of residence is in Liechtenstein must apply to be entered in the TT Service Provider Register maintained by the Financial Market Authority (FMA) in Liechtenstein before they can provide such services.

You can find more detailed information about the application process, the defined roles for TT Service Providers and Bank Frick’s innovative blockchain banking services below. Do not hesitate to contact us – our Bank Frick experts will be happy to help.

Registration

Requirements

As noted above, any company or individual whose registered office or place of residence is in Liechtenstein and who wishes to act as a professional TT Service Provider, must be entered in the TT Service Provider Register of the FMA. In addition, if Token Issuers intend to create CHF 5 million worth of tokens or more within 12 months, either in their own name or in the name of a client in a non-professional capacity, they must also be entered in the TT Service Provider Register. However, the applicant must fulfil certain requirements in order to be entered in the register:

  • Be capable of acting
  • Be trustworthy
  • Be professionally qualified
  • Have their registered office or place of residence in Liechtenstein
  • Have the necessary minimum capital, where appropriate
  • Have an appropriate organisational structure with defined areas of responsibility, including procedures for dealing with conflicts of interest
  • Have written internal procedures and control mechanisms, including documentation of these mechanisms
  • Have special internal control mechanisms, where appropriate
  • If the applicant intends to act as a TT Protector, authorisation pursuant to the Liechtenstein Trustees Act (Treuhändergesetz, TrHG)
  • Special statutory authorisation, if the applicant intends to conduct activities that are subject to additional special statutory authorisation obligations pursuant to Article 5(1) of the Financial Market Supervision Act (FMA Act; Finanzmarktaufsichtsgesetz, FMAG)

Registration procedure

The registration application must include the following information and documents:

  • Name or company name and address of the applicant
  • Information about the intended TT Service
  • Information about the TT Systems to be used during the planned TT Service
  • Information about the legal form of the applicant if the applicant is a legal entity
  • Evidence that the requirements pursuant to Articles 13 to 17 of the TVTG have been met
  • Further information and documents at the request of the FMA if necessary to assess the registration application

The application may be submitted to the FMA electronically. The FMA may request that certificates be submitted in their original form, or it may ask that they be notarised or apostilled before being submitted. Certain documents may be waived if the FMA already has access to them. Once the application is complete, the FMA must decide within three months whether the registration requirements have been met. Any changes to the application must be reported to the FMA without delay. Decisions by the FMA may be appealed to the FMA Complaints Commission within 14 days. In addition, decisions and decrees by the FMA Complaints Commission may also be appealed within 14 days to the Administrative Court. The applicants may only perform the services after they have been entered in the TT Service Provider Register.

Fees for official processing

  • Accepting or rejecting the registration as a TT Service Provider: CHF 1,500
  • Registration of each additional TT Service Provider: CHF 700

Further information on FMA registration can be found here.

Custody

TT Key Depositary

Safeguards the TT Keys for clients, for example, to better protect clients from abuse.

Minimum capital

CHF 100,000.

If applicants intend to provide other services in addition to this TT Service, then the highest minimum capital requirement for the relevant TT Services in accordance with the TVTG applies.

Special internal control mechanisms

TT Key Depositaries must ensure that suitable internal control mechanisms are in place before commencing their activities in order to:

  • implement suitable security measures to prevent, in particular, the loss or abuse of the TT Keys
  • ensure the separate custody of clients’ TT Keys from the TT Key Depositary’s business assets
  • ensure business continuity management to maintain the services in the event of business disruptions

Safeguarding requirements

The TT Keys held or kept in safe custody for a client, either in the TT Key Depositary’s own name or in the client’s name, are considered third-party assets in the event of enforcement proceedings, composition proceedings or bankruptcy. Clients must be protected against claims by the TT Key Depositary’s other creditors.

In the event of enforcement proceedings against the TT Key Depositary in respect of the TT Keys, clients have the right to appeal (Article 20 of the Liechtenstein Execution Act [Exekutionsordnung]). In addition, in the event of the bankruptcy of the TT Key Depositary, clients have the right to have their Tokens segregated from the TT Key Depositary’s assets (Article 41 of the Liechtenstein Bankruptcy Act [Konkursordnung]).

Record-keeping

TT Key Depositaries must keep all relevant records and supporting documents for supervisory purposes for at least 10 years.

Reporting obligations

TT Key Depositaries must provide the FMA with all information about their business activities that is necessary to carry out supervision. In addition, TT Key Depositaries must immediately inform the FMA of:

  • all changes related to the registration requirements
  • the cessation of business activities
  • their removal from the Commercial Register
  • the existence of other reasons for cancellation in accordance with Article 20 of the TVTG

Publication obligations

TT Key Depositaries must publish the following in a manner that permits it to be accessed by the public at all times:

  • Information about the TT Systems they use
  • A declaration regarding the suitability of the TT Systems they use for the relevant purposes
  • Information about any changes to a TT System, including the reason for the change

Conditions regarding the outsourcing of operational functions

TT Key Depositories may outsource certain operational functions as long as the quality of the internal control is not significantly impacted, the obligations under the TVTG remain unchanged and the registration requirements are met.

Due Diligence Act

The Liechtenstein Due Diligence Act (DDA; Sorgfaltspflichtgesetz, SPG) applies to persons subject to due diligence, which includes TT Service Providers pursuant to Article 2(1)(k) and (m) to (q) of the TVTG. Thus, TT Key Depositaries must comply with the DDA.

Supervision tax

Supervision taxes and fees are levied in accordance with the Financial Market Supervision Act (FMAG).

  • The basic fee for TT Key Depositaries is CHF 500 per year. TT Key Depositaries who register to provide several services only have to pay the basic fee once.
  • An additional fee of 0.25% of gross sales revenues is charged for all TT Services, less value-added tax and other taxes directly related to sales during the financial year. The additional fee is calculated on the basis of the gross sales revenues from the TT Services for the financial year preceding the year of fee settlement
  • The maximum annual supervision fee per supervised party is CHF 100,000.
  • For newly registered TT Key Depositories, gross sales revenues from all TT Services up to 31 December of the current year are used as the basis for calculating the fee. The fee is collected the following year.

Learn more about Bank Frick’s world-class blockchain banking services and contact us today. 

TT Token Depositary

Safeguards Tokens in the name and for the account of others. It must be ensured that Tokens held in custody can clearly be assigned to the corresponding clients.

Minimum capital

CHF 100,000.

If applicants intend to provide other services in addition to this TT Service, then the highest minimum capital requirement for the relevant TT Service in accordance with the TVTG applies.

Special internal control mechanisms

TT Token Depositaries must ensure that suitable internal control mechanisms are in place before commencing activities in order to:

  • implement suitable security measures to prevent, in particular, the loss or abuse of the TT Keys
  • ensure the separate custody of clients’ Tokens from the TT Token Depositary’s business assets
  • ensure the clear assignment of clients’ Tokens
  • execute clients’ orders in line with agreements
  • ensure business continuity management to maintain the services in the event of business disruptions

Safeguarding requirements

  • Tokens held in the name of a client are considered third-party assets in the event of enforcement proceedings, composition proceedings or bankruptcy. Clients must be protected against claims by the TT Token Depositary’s other creditors. Tokens must be held separately from the TT Token Depositary’s assets at all times.
  • Upon request, TT Token Depositaries must present proof to the FMA that sufficient measures have been implemented to comply with safeguarding requirements. If supporting documents are not submitted or precautions not taken, or if this is not done within the stipulated deadline, the FMA may take further actions as described in Article 43(5) of the TVTG.
  • In the event of enforcement proceedings against the TT Token Depositary in respect of the Tokens, clients have the right to appeal (Article 20 of the Execution Act). In addition, in the event of the bankruptcy of the TT Token Depositary, clients have the right to have their Tokens segregated from the TT Token Depositary’s assets (Article 41 of the Bankruptcy Act).

Record-keeping

TT Token Depositories must keep all relevant records and supporting documents for supervisory purposes for at least 10 years.

Reporting obligations

TT Token Depositaries must provide the FMA with all information about their business activity required to exercise supervision. In addition, TT Token Depositaries must inform the FMA immediately of:

  • all changes related to the registration requirements
  • the cessation of business activities
  • their removal from the Commercial Register
  • the existence of other reasons for cancellation in accordance with Article 20 of the TVTG

Publication obligations

TT Token Depositories must publish the following in a manner that permits it to be accessed by the public at all times:

  • Information about the TT Systems they use
  • A declaration regarding the suitability of the TT Systems they use for the relevant purposes
  • Information about any changes to a TT System, including the reason for the change

Conditions regarding the outsourcing of operational functions

TT Token Depositaries may outsource certain operational functions as long as the quality of the internal control is not significantly impacted, the obligations under the TVTG remain unchanged and the registration requirements are met.

Due Diligence Act

The Liechtenstein Due Diligence Act (DDA; Sorgfaltspflichtgesetz, SPG) applies to persons subject to due diligence, which includes TT Service Providers in accordance with Article 2(1)(k) and (m) to (q) of the TVTG. Thus, TT Token Depositaries must comply with the DDA.

Supervision tax

The Supervision taxes and fees are levied in accordance with the Financial Market Supervision Act (FMAG).

  • The basic fee for TT Token Depositaries is CHF 500 per year. TT Token Depositaries who register to provide several services only have to pay the basic fee once.
  • An additional fee of 0.25% of gross sales revenues is charged for all TT Services, less value-added tax and other taxes directly related to sales during the financial year. The additional fee is calculated on the basis of the gross sales revenues from the TT Services for the financial year preceding the year of fee settlement
  • The maximum annual supervision fee per supervised party is CHF 100,000.
  • For newly registered TT Token Depositaries, the gross sales revenues from all TT Services up to 31 December of the current year are used as the basis for calculating the fee. This fee is collected the following year.

Learn more about Bank Frick’s world-class blockchain banking services and contact us today.

TT Protector

TT Protectors hold Tokens on TT Systems in their own name and on behalf of others. This activity is a typical fiduciary service, as the TT Protector acts on behalf of the beneficial owners.

Minimum capital

Not required in accordance with the TVTG.

If applicants intend to provide other services in addition to this TT Service, then the highest minimum capital requirement for the relevant TT Service in accordance with the TVTG applies.

Special internal control mechanisms

TT Protectors must ensure that suitable internal control mechanisms are in place before commencing their activities in order to:

  • implement suitable security measures to prevent, in particular, the loss or abuse of the TT Keys
  • ensure the separate custody of clients’ Tokens from the TT Protector’s assets
  • ensure the clear assignment of clients’ Tokens
  • execute clients’ orders in line with agreements
  • ensure business continuity management to maintain services in the event of business disruptions

Safeguarding requirements

  • Tokens held in trust are considered third-party assets in the event of enforcement proceedings, composition proceedings or bankruptcy. Clients must be protected against claims by the TT Protector’s other creditors. Tokens must be stored separately from the TT Protector’s assets at all times.
  • Upon request, TT Protectors must present proof to the FMA that sufficient measures have been taken to comply with safeguarding requirements. If supporting documents are not submitted or precautions not taken, or this is not done within the stipulated deadline, the FMA may take further actions as described in Article 43(5) of the TVTG.
  • In the event of enforcement proceedings against the TT Protector in respect of the Tokens, clients have the right to appeal (Article 20 of the Execution Act). In addition, in the event of the bankruptcy of the TT Protector, clients have the right to have their Tokens segregated from the TT Protector’s assets (Article 41 of the Bankruptcy Act).

Record-keeping

TT Protectors must keep all relevant records and supporting documents for supervisory purposes for at least 10 years.

Reporting obligations

TT Protectors must provide the FMA with all information about their business activities that is necessary to carry out supervision. In addition, TT Protectors must immediately inform the FMA of:

  • all changes related to the registration requirements
  • the cessation of business activities
  • their removal from the Commercial Register
  • the existence of other reasons for cancellation in accordance with Article 20 of the TVTG

Publication obligations

TT Protectors must publish the following in a manner that permits it to be accessed by the public at all times:

  • Information about the TT Systems they use
  • A declaration regarding the suitability of the TT Systems they use for the relevant purposes
  • Information about any changes to a TT System, including the reason for the change

Conditions regarding the outsourcing of operational functions

TT Protectors may outsource certain operational functions as long as the quality of the internal control is not significantly impacted, the obligations under the TVTG remain unchanged and the registration requirements are met.

Due Diligence Act

The Liechtenstein Due Diligence Act (DDA; Sorgfaltspflichtgesetz, SPG) applies to persons subject to due diligence, which includes TT Service Providers in accordance with Article 2(1)(k) and (m) to (q) of the TVTG. Thus, TT Protectors must comply with the DDA.

Licence as trustee

The TT Protector must have the authorisation pursuant to the Trustees Act.

Supervision tax

Supervision taxes and fees are levied in accordance with the Financial Market Supervision Act (FMAG).

  • The basic fee for TT Protectors is CHF 500 per year.
  • There is an additional levy for TT Protectors that carry out activities that are relevant for due diligence during the tax year of CHF 50 for each business relationship that is relevant for due diligence. The number of business relationships that are relevant for due diligence as at 31 December of the year, preceding the year of fee settlement, is used to calculate the additional fee.
  • For newly registered TT Protectors, the number of business relationships that are relevant for due diligence as at 31 December of the current year is used to calculate the additional fee. The fee is collected the following year.
  • TT Protectors that are registered to provide several TT Services must also pay the supervision fee in accordance with the prevailing provisions of the FMA Act.
  • The maximum annual supervision fee per supervised party is CHF 100,000.

Learn more about Bank Frick’s world-class blockchain banking services and contact us today. 

Financial Intermediaries

Physical Validator

Ensures the contractual enforcement of token rights to objects on TT Systems as defined by local property law. This may include the identification of the objects’ value, the identification of the client and the assurance that the latter is also the owner of the object of value.

Minimum capital

  • CHF 125,000 if the value of the property for which the contractual enforcements are guaranteed by the Physical Validator does not exceed CHF 10 million
  • CHF 250,000 if the value of the property for which the contractual enforcements are guaranteed by the Physical Validator exceeds CHF 10 million

If applicants intend to provide other services in addition to this TT Service, then the highest minimum capital requirement for the relevant TT Service in accordance with the TVTG applies.

Special internal control mechanisms

Physical Validators must ensure that suitable internal control mechanisms are in place before commencing their activities in order to:

  • ensure their liability in the event the rights to property guaranteed by Physical Validators cannot be enforced in accordance with the contract.

Record-keeping

Physical Validators must keep all relevant records and supporting documents for supervisory purposes for at least 10 years.

Reporting obligations

Physical Validators must provide the FMA with all information about their business activities that is necessary to carry out supervision. In addition, Physical Validators must immediately inform the FMA of:

  • all changes related to the registration requirements
  • the cessation of business activities
  • their removal from the Commercial Register
  • the existence of other reasons for cancellation pursuant to Article 20 of the TVTG

Publication obligations

Physical Validators must publish the following in a way that can be accessed by the public at any time:

  • Information about the TT Systems they use
  • A declaration regarding the suitability of the TT Systems they use for the relevant purposes
  • Information about any changes to a TT System, including the reason for the change

Conditions regarding the outsourcing of operational functions

Physical validators may outsource certain operational functions as long as the quality of the internal control is not significantly impacted, the obligations under the TVTG remain unchanged and the registration requirements are met.

Due Diligence Act

The Liechtenstein Due Diligence Act (DDA; Sorgfaltspflichtgesetz, SPG) applies to persons subject to due diligence, which includes TT Service Providers in accordance with Article 2(1)(k) and (m) to (q) of the TVTG. Thus, Physical Validators must comply with the DDA.

Supervision tax

Supervision taxes and fees are levied in accordance with the Financial Market Supervision Act (FMAG).

  • The basic fee for Physical Validators is CHF 500 per year. Physical Validators who register to provide several services only have to pay the basic tax once.
  • An additional fee of 0.25% of gross sales revenues is charged for all TT Services, less value-added tax and other taxes directly related to sales during the financial year. The additional fee is calculated on the basis of the gross sales revenues from the TT Services for the financial year preceding the year of fee settlement.
  • The maximum annual supervision fee per supervised party is CHF 100,000.
  • For newly registered Physical Validators, the gross revenues from all TT Services up to 31 December of the current year are used as the basis for calculating the fee. This fee is collected the following year.

Learn more about Bank Frick’s world-class blockchain banking services and contact us today. 

TT Verifying Authority

Verifies that legal capacity and the requirement regarding the disposal of a Token have been met, as the transfer of Tokens on TT Systems takes place, for most part, without any personal contact.

Minimum capital

Not required in accordance with the TVTG.

If applicants intend to provide other services in addition to this TT Service, then the highest minimum capital requirement for the relevant TT Service in accordance with the TVTG applies.

Special internal control mechanisms

TT Verifying Authorities must ensure that suitable internal control mechanisms are in place before commencing their activities in order to:

  • implement suitable measures that ensure that the verification services offered are considered to be reliable.

Record-keeping

TT Verifying Authorities must keep all relevant records and supporting documents for supervisory purposes for at least 10 years.

Reporting obligations

TT Verifying Authorities must provide the FMA with all information about their business activities that is necessary to carry out supervision. In addition, TT Verifying Authorities must immediately inform the FMA of:

  • all changes related to the registration requirements
  • the cessation of business activities
  • their removal from the Commercial Register
  • the existence of other reasons for cancellation in accordance with Article 20 of the TVTG

Publication obligations

TT Verifying Authorities must publish the following in a manner that permits it to be accessed by the public at all times:

  • Information about the TT Systems they use
  • A declaration regarding the suitability of the TT Systems they use for the relevant purposes
  • Information about any changes to a TT System, including the reason for the change

Conditions regarding the outsourcing of operational functions

TT Verifying Authorities may outsource certain operational functions as long as the quality of the internal control is not significantly impacted, the obligations under the TVTG remain unchanged and the registration requirements are met.

Due Diligence Act

The Liechtenstein Due Diligence Act (DDA; Sorgfaltspflichtgesetz, SPG) applies to persons subject to due diligence, which includes TT Service Providers in accordance with Article 2(1)(k) and (m) to (q) of the TVTG. Thus, the DDA does not apply to TT Verifying Authorities.

Supervision tax

Supervision taxes and fees are levied in accordance with the Financial Market Supervision Act (FMAG). The annual supervisory fee for TT Verifying Authorities is CHF 250. The annual supervision fee is not applicable if TT Verifying Authorities have to pay other supervision fees in accordance with Annex 2, Chapter VIII A and B of the FMA Act.

Learn more about Bank Frick’s world-class blockchain banking services and contact us today. 

TT Price Service Provider

Provides the Users of TT Systems with aggregated price information based on purchase and sale offers or completed transactions.

Minimum capital

Not required in accordance with the TVTG.

If applicants intend to provide other services in addition to this TT Service, then the highest minimum capital requirement for the relevant TT Service in accordance with the TVTG applies.

Special internal control mechanisms

TT Price Service Providers must ensure that suitable internal control mechanisms are in place before commencing their activities in order to:

  • ensure the transparency of the published prices
  • ensure that there are no conflicts of interest when setting prices
  • disclose information to affected users regarding transactions involving related parties

Record-keeping

TT Price Service Providers must keep all relevant records and supporting documents for supervisory purposes for at least 10 years.

Reporting obligations

TT Price Service Providers must provide the FMA with all information about their business activities that is necessary to carry out supervision. In addition, TT Price Service Providers must immediately inform the FMA of:

  • all changes related to the registration requirements
  • the cessation of business activities
  • their removal from the Commercial Register
  • the existence of other reasons for cancellation in accordance with Article 20 of the TVTG

Publication obligations

TT Price Service Providers must publish the following in a manner that permits it to be accessed by the public at all times:

  • Information about the TT Systems they use
  • A declaration regarding the suitability of the TT Systems they use for the relevant purposes
  • Information about any changes to a TT System, including the reason for the change

Conditions regarding the outsourcing of operational functions

TT Price Service Providers may outsource certain operational functions as long as the quality of the internal control is not significantly impacted, the obligations under the TVTG remain unchanged and the registration requirements are met.

Due Diligence Act

The Liechtenstein Due Diligence Act (DDA; Sorgfaltspflichtgesetz, SPG) applies to persons subject to due diligence, which includes TT Service Providers in accordance with Article 2(1)(k) and (m) to (q) of the TVTG. Thus, the DDA does not apply to TT Price Service Providers.

Supervision tax

The Supervision taxes and fees are levied in accordance with the Financial Market Supervision Act (FMAG). The annual supervision fee for TT Price Service Providers is CHF 250. The annual supervisory fee is not applicable if TT Price Service Providers have to pay other supervision fees in accordance with Annex 2, Chapter VIII A and B of the FMA Act.

Learn more about Bank Frick’s world-class blockchain banking services and contact us today. 

TT Identity Service Provider

Identifies the person in possession of the right of disposal of a Token and records the right of disposal in a directory. This means that the TT Identifier is registered with the TT Identity Service Provider and assigned to the owner.

Minimum capital

Not required in accordance with the TVTG.

If applicants intend to provide other services in addition this TT Service, then the highest minimum capital requirement for the relevant TT Service in accordance with the TVTG applies.

Special internal control mechanisms

TT Identity Service Providers must ensure that suitable internal control mechanisms are in place before commencing their activities in order to:

  • ensure the use of appropriate measures that make it possible to establish the identity of the person with the right of disposal, and also ensuring:
    1. for natural persons or representatives of a legal person who are physically present, that they are identified either based on an official photo identification or another document of equivalent reliability; in addition, for representatives of legal persons, it must be ensured that the necessary power of representation has been granted
    2. for natural persons or legal persons who are not physically present, other identification methods must be applied that enable identification equivalent to a)
  • ensure the specific assignment of TT Identifiers to the lawful holder
  • ensure the secure storage of client data

Record-keeping

TT Identity Service Providers must keep all relevant records and supporting documents for supervisory purposes for at least 10 years.

Reporting obligations

TT Identity Service Providers must provide the FMA with all information about their business activities that is necessary to carry out supervision. In addition, TT Identity Service Providers must immediately inform the FMA of:

  • all changes related to the registration requirements
  • the cessation of business activities
  • their removal from the Commercial Register
  • the existence of other reasons for cancellation in accordance with Article 20 of the TVTG

Publication obligations

TT Identity Service Providers must publish the following in a manner that permits it to be accessed by the public at all times:

  • Information about the TT Systems they use
  • A declaration regarding the suitability of the TT Systems they use for the relevant purposes
  • Information about any changes to a TT System, including the reason for the change

Conditions regarding the outsourcing of operational functions

TT Identity Service Providers may outsource certain operational functions as long as the quality of the internal control is not significantly impacted, the obligations under the TVTG remain unchanged and the registration requirements are met.

Due Diligence Act

The Liechtenstein Due Diligence Act (DDA; Sorgfaltspflichtgesetz, SPG) applies to persons subject to due diligence, which includes TT Service Providers in accordance with Article 2(1)(k) and (m) to (q) of the TVTG. Thus, the DDA does not apply TT Identity Service Providers.

Supervision tax

The Supervision taxes and fees are levied in accordance with the Financial Market Supervision Act (FMAG). The annual supervision fee for TT Identity Service Providers is CHF 250. The annual supervision fee is not applicable if TT Identity Service Providers have to pay other supervision fees in accordance with Annex 2, Chapter VIII A and B of the FMA Act.

Learn more about Bank Frick’s world-class blockchain banking services and contact us today. 

 

Token Issuance

Token Issuer

Publicly offers Tokens in their own name or in the name of the client.

Minimum capital

  • CHF 50,000 for Tokens issued with a total value of up to CHF 5 million during a calendar year
  • CHF 100,000 for Tokens issued with a total value of more than CHF 5 million and up to and including CHF 25 million during a calendar year
  • CHF 250,000 for Tokens issued with a total value of more than CHF 25 million during a calendar year

If applicants intend to provide other services in addition to this TT Service, then the highest minimum capital requirement for the relevant TT Service in accordance with the TVTG applies.

Special internal control mechanisms

Token Issuers must ensure that suitable internal control mechanisms are in place before commencing activities in order to:

  • disclose basic information at all times during Token Issuance and for at least 10 years afterwards
  • prevent abuse with respect to the option on the part of Token recipients to waive basic information
  • carry out Token Issuance in accordance with the conditions of basic information
  • maintain the provided services in the event of interruptions during the Token Issuance (business continuity management)

Record-keeping

Token Issuers must keep all relevant records and supporting documents for supervisory purposes for at least 10 years.

Reporting obligations

Token Issuers must provide the FMA with all information about their business activities that is necessary to carry out supervision. In addition, TT Token Issuers must immediately inform the FMA of:

  • all changes related to the registration requirements
  • the cessation of business activities
  • their removal from the Commercial Register
  • other reasons for cancellation in accordance with Article 20 of the TVTG

Publication obligations

Token Issuers must publish the following in a manner that permits it to be accessed by the public at all times:

  • Information about the TT Systems they use
  • A declaration regarding the suitability of the TT Systems they use for the relevant purposes
  • Information about any changes to a TT System, including the reason for the change

Obligation to compile and publish basic information and to report the Token Issuance

Before issuing Tokens, Token Issuers must carry out the following steps, unless there is an exception in accordance with Article 31 of the TVTG:

  • Provide basic information in accordance with Article 33 of the TVTG
  • Publish the basic information in a manner that provides easy to access to the information
  • Report the Token Issuance to the FMA

Requirements regarding the form and language of the basic information

  • It must be prepared and published in a way that is easy to analyse and understand, and in German or English.
  • It may be prepared and published as one or several documents. If it is published as several documents, the Token Issuer must publish a summary, including information about the Token Issuer and the Tokens to be issued.
  • New facts or errors related to the basic information must be listed in an addendum to the basic information.

Conditions regarding the outsourcing of operational functions

Token Issuers may outsource certain operational functions as long as the quality of internal control is not significantly impacted, the obligations under the TVTG remain unchanged and the registration requirements are met.

Due Diligence Act

The Liechtenstein Due Diligence Act (DDA; Sorgfaltspflichtgesetz, SPG) applies to persons subject to due diligence, which includes TT Service Providers in accordance with Article 2(1)(k) and (m) to (q) of the TVTG. Thus, Token Issuers must comply with the DDA.

Token Issuers whose registered office or place of residence is in Liechtenstein and who issue Tokens on their own behalf, or on behalf of their clients in a non-professional capacity, do not need to register and therefore do not fall under the DDA. However, if they process transactions of CHF 1,000 or more, regardless of whether the transaction takes place in a single operation or in several operations among which there appears to be a connection, then the DDA applies.

Supervision tax

Supervision taxes and fees are levied in accordance with the Financial Market Supervision Act (FMAG).

Token Issuers who act as TT Service Providers on a professional basis in accordance with Article 12(1) of the TVTG

  • The basic fee for Token Issuers is CHF 500 per year. Token Issuers who register to provide several services only have to pay the basic fee once.
  • An additional fee of 0.25% of gross sales revenues is charged for all TT Services, less value-added tax and other taxes directly related to sales during the financial year. The additional fee is calculated on the basis of the gross sales revenues from the TT Services for the financial year preceding the year of fee settlement.
  • The maximum annual supervision fee per supervised party is CHF 100,000.
  • For newly registered Token Issuers, the gross sales revenues from all TT Services up to 31 December of the current year are used as the basis for calculating the fee. This fee is collected the following year.

Token Issuers who act in their own name or in the name of the client on a non-professional basis in accordance with Article 12(2) of the TVTG

  • The annual supervisory fee for Token Issuers is 0.1% of the equivalent value in CHF, upon issue, of all cryptocurrencies and monies received. To calculate the exchange rate, the date of the initial offer is considered to be the reporting date. The equivalent value as at 31 December of the year preceding the tax year is used to calculate the additional fee.
  • The maximum annual supervision tax per supervised party is CHF 100,000.
  • For newly registered Token Issuers, the equivalent of all issues as at 31 December of the current year is used as the basis for assessing the fee. The fee is collected the following year.
  • Token Issuers who are registered for other TT Services only need to pay the supervisory fees for the service which results in the highest amount of supervisory fees.

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Token Generator

The Token Generator, as the name implies, generates one or more tokens. The Token Generator determines the rules for how Tokens function, which interactions are possible and, in particular, under what circumstances Tokens can be transmitted.

Minimum capital

Not required in accordance with the TVTG.

If applicants intend to provide other services in addition to this TT Service, then the highest minimum capital requirement for the relevant TT Service in accordance with the TVTG applies.

Special internal control mechanisms

Token Generators must ensure that suitable internal control mechanisms are in place before commencing activities in order to:

  • ensure that the right is properly represented in the Token throughout the Token’s lifetime;
  • ensure that disposal of a Token directly leads to disposal of the represented right
  • ensure that a competing disposal of the represented right is excluded both under the rules of the TT System and the provisions of applicable law

Record-keeping

Token Generators must keep all relevant records and supporting documents for supervisory purposes for at least 10 years.

Reporting obligations

Token Generators must provide the FMA with all information about their business activities that is necessary to carry out supervision. In addition, Token Generators must immediately inform the FMA of:

  • all changes related to the registration requirements
  • the cessation of business activities
  • their removal from the Commercial Register
  • the existence of other reasons for cancellation in accordance with Article 20 of the TVTG

Publication obligations

Token Generators must publish the following in a manner that permits it to be accessed by the public at all times:

  • Information about the TT Systems they use
  • A declaration regarding the suitability of the TT Systems they use for the relevant purposes
  • Information about any changes to a TT System, including the reason for the change

Conditions regarding the outsourcing of operational functions

Token Generators may outsource certain operational functions as long as the quality of the internal control is not significantly impacted, the obligations under the TVTG remain unchanged and the registration requirements are met.

Due Diligence Act

The Liechtenstein Due Diligence Act (DDA; Sorgfaltspflichtgesetz, SPG) applies to persons subject to due diligence, including TT Service Providers in accordance with Article 2(1)(k) and (m) to (q) of the TVTG. Thus, the DDA does not apply to Token Generators.

Supervision tax

Supervision taxes and fees are levied in accordance with the Financial Market Supervision Act (FMAG). The annual supervisory fee for Token Generators is CHF 250. The annual supervisory tax is not applicable if Token Generators have to pay other supervision fees in accordance with Annex 2, Chapter VIII A and B of the FMA Act.

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Exchange

TT Exchange Service Provider

Exchanges legal tender such as euros or Swiss francs, for Tokens (and vice versa) and Tokens for Tokens.

Minimum capital

  • CHF 30,000 if transactions with a total value of more than CHF 150,000 and up to and including CHF 1 million are carried out during a calendar year
  • CHF 100,000 if transactions with a total value of more than CHF 1 million are carried out during a calendar year

If applicants intend to provide other services in addition to this TT Service, then the highest minimum capital requirement for the relevant TT Service in accordance with the TVTG applies.

Special internal control mechanisms

TT Exchange Service Providers must ensure that suitable internal control mechanisms are in place before commencing their activities in order to:

  • ensure the disclosure of the comparable market prices for the traded Tokens
  • ensure the disclosure of the purchase and sale prices for the traded Tokens

Record-keeping

TT Exchange Service Providers must keep all relevant records and supporting documents for supervisory purposes for at least 10 years.

Reporting obligations

TT Exchange Service Providers must provide the FMA with all information about their business activities that is necessary to carry out supervision. In addition, TT Exchange Service Providers must immediately inform the FMA of:

  • all changes related to the registration requirements
  • the cessation of business activities
  • their removal from the Commercial Register
  • the existence of other reasons for cancellation in accordance with Article 20 of the TVTG

Publication obligations

TT Exchange Service Providers must publish the following in a manner that permits it to be accessed by the public at all times:

  • Information about the TT Systems they use
  • A declaration regarding the suitability of the TT Systems they use for the relevant purposes
  • Information about any possible change in a TT System, including the reason for the change

Conditions regarding the outsourcing of operational functions

TT Exchange Service Providers may outsource certain operational functions as long as the quality of the internal control is not significantly impacted, the obligations under the TVTG remain unchanged and the registration requirements are met.

Due Diligence Act

The Liechtenstein Due Diligence Act (DDA; Sorgfaltspflichtgesetz, SPG) applies to persons subject to due diligence, which includes TT Service Providers in accordance with Article 2(1)(k) and (m) to (q) of the TVTG. Thus, TT Exchange Service Providers must comply with the DDA.

Supervision tax

Supervision taxes and fees are levied in accordance with the Financial Market Supervision Act (FMAG).

  • The basic fee for TT Exchange Service Providers is CHF 500 per year. TT Exchange Service Providers who register for several services only have to pay the basic tax once.
  • An additional fee of 0.25% of gross sales revenues is charged for all TT Services, less value-added tax and other taxes directly related to sales during the financial year. The additional fee is calculated on the basis of the gross sales revenues from the TT Services for the financial year preceding the year of fee settlement.
  • The maximum annual supervision fee per supervised party is CHF 100,000.
  • For newly registered TT Exchange Service Providers, the gross sales revenues from all TT services as at 31 December of the current year is used as the basis for calculating the additional fee. This fee is collected the following year.

Learn more about Bank Frick’s world-class blockchain banking services and contact us today. 

Frequently Asked Questions

You can also find further information in our FAQ section.

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Stefan Rauti

Head of Blockchain Banking

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