Backtrack Of LCX Liechtenstein Blockchain Laws Framework 2021
tarafından LCX Team · · Updated February 6, 2023
The Cryptocurrency industry is growing by leaps and bounds, and there are certain rules, laws, and regulations that need to be followed to officially be part of this side of the economy.
With an idea on paper and building a licensed blockchain ecosystem, LCX has come a long way, and the journey has been superlative. This year, also the founder of LCX, Monty C. M. Metzger has turned every stone to ensure that LCX is a regulated and fully compliant company.
The Liechtenstein Cryptoassets Exchange (LCX) believes that regulating the system will ultimately help avoid crypto frauds. Therefore, LCX is registered with the Financial Market Authority of Liechtenstein (FMA) pursuant to the TVTG regulatory framework (Token and Trusted Technology Service Provider Act). Let’s deep dive into the details:
TT EXCHANGE SERVICE PROVIDER
LCX is registered as a Trusted Technology exchange service provider, it exchanges legal tender like Swiss francs or Euros for Tokens and vice versa, as well as Tokens for others.
Special internal control mechanisms
LCX, as a TT Exchange Service Provider, makes sure that appropriate internal control mechanisms are all set before beginning their activities to:
- make sure the disclosure of the similar market prices for the traded Tokens
- make sure the declaration of the sale and purchase prices for the traded Tokens
Reporting obligations
LCX, as a TT Exchange Service Provider, provides the FMA with every detail regarding business activities that is mandatory in order for the FMA to carry out their legal mandate. Additionally, LCX instantly informs the FMA of:
- any modification associated with the registration
- the discontinuation of business activities.
- the deletion from the Commercial Register
- the existence of another cause for cancellation in conformity with Article 20 of the TVTG
TT TOKEN DEPOSITORY
The tokens are safeguarded in the name of others or for the account of others. The TVTG expresses that the TT service provider, i.e., LCX, must make sure that tokens kept in custody are segregated from the corresponding users.
Special internal control mechanisms
LCX, as a TT Token Depositary, makes sure that appropriate internal control mechanisms are all set prior to start of activities for the purpose to:
- execute appropriate security standards to safeguard, in specific, the loss or mishandling of the TT Keys
- make sure to segregate custody of Tokens of clients from the business assets of the TT Token Depositary
- ensure the correct allocation of Tokens of the clients
- implement the orders of the clients in line with the agreements
TT KEY DEPOSITARY
LCX guards the TT keys (e.g. private keys) for clients, for instance, to enhance the protection of clients from loss or mishandling of private keys..
Safeguarding requirements
The TT Keys kept in protective trusteeship for a client, whether in the own name of the TT Key Depositary or in the name of the client, are deemed separated third-party assets in the incident of execution proceedings, constitution proceedings, or bankruptcy. Clients will be safeguarded from claims by the TT Key Depositary’s other creditors.
TT PRICE SERVICE PROVIDER
LCX, as a TT Price Service Provider offers the TT system to the users with aggregated price details depending on sale and purchase offer or finished transaction.
Special internal control mechanisms
LCX, as a TT Price Service Provider makes sure that appropriate internal control mechanisms are all ready before initiating their activities in the interest of:
- making sure that transparent prices are published
- make sure that there is no conflict of interest when determining prices.
- exchange details of related party transactions with the users concerned.
TOKEN ISSUER
LCX, as a token issuer, publicly provides the service of Token issuance in their name (Token Issuer pursuant to Art. 12 para. 2 TVTG) or in the name of the client (Token Issuer pursuant to Art. 12 para. 1 TVTG).
Special internal control mechanisms
LCX, as a Token Issuer, makes sure that appropriate internal control mechanisms are all set prior to start activities for the purpose to:
- share legally required basic details at every time throughout Token Issuance
- prevent abuse related to token recipients’ decision to disclose basic data
- perform Token Issuance in conformity with the TVTG
- maintain the offered services in the case of interruptions throughout the Token Issuance (business continuity management)
TT IDENTITY SERVICE PROVIDERS
LCX as a TT identifier identifies the person in ownership with the right to dispose of a token and record the right of disposal in a directory. This indicates that with the TT Identity Service Provider, the TT Identifier (e.g. public key) is registered and designated/allocated to the owner.
Special internal control mechanisms
LCX, as a TT Identity Service Provider, ensures that appropriate internal control mechanisms are all ready before initiating their activities in the interest of:
- make sure of the utilization of suitable measures that make it feasible to determine the identity of the person with the disposal right, and also guarantee:
- for representatives or persons of a legal person who are present physically, they are identified either depending on an official photo identification or other document of identical trustworthiness.
- for legal persons or person who are not present physically, other identification ways must be executed that allows identification similar to a)
TOKEN GENERATOR
LCX as a token generator establishes the technical rules for how Tokens function, which communications are feasible and, in specific, under what situations Tokens can be transmissible.
Special internal control mechanisms
LCX, as a Token Generator makes sure that appropriate internal control mechanisms are all ready prior to commence actions in order to:
- make sure that the proper representation of the rights in the Token is done during the Token’s lifetime;
- make sure that disposal of a Token straight leads to transferral of the rights represented by the Token.
- ensure that double-spending of the right represented by the token is precluded under both the relevant legislation and the rules of the TT system.
LCX has gathered all these registrations and become one of the world’s most trusted and valued fintech companies.
To know more about LCX products and insights, please follow LCX Insights!
