Between Switzerland and Austria is a small country making big moves. This country is Liechtenstein, and its government has just passed the Blockchain Act after the second reading.

This makes Liechtenstein the first country to have a legal framework for the blockchain industry.

In fact, on May 7th 2019, the government of Liechtenstein approved the bill on Tokens and Trustworthy Technology Service Providers. And now, on October 3rd, the bill has successfully passed through the second reading in the parliament — meaning this country has took yet another giant step in embracing the blockchain technology.

For those who don’t know, second reading is the stage in which the proposed bill is, well, read for the second time.

Blockchain Companies To Have Better Legal Frameworks

Published in German, you can check out the 384 page report here.

There were a lot of players involved in forming the Blockchain Act. From Bitcoin Suisse’s CEO (Mauro Casellini) to the founder of Nagele Law (Thomas Nägele). In fact, the Prime Minister of the country (Adrian Hasler) has been working on this act for about three years now.

With such act being passed, we will witness a holistic legal framework, which will eventually lead to the growth of the industry — as big and small companies around blockchain can focus on building valuable products. And not worry about the legalities involved.

For example: The act will offer a legal basis for security tokens, ownership of digital assets, transfer of crypto assets, setting up exchanges, licensing of crypto companies, IEO, ICO, and any other token sales. All this and more is wrapped under the legal framework.

There’s More To This Blockchain Act

Several lawyers and firms are already claiming this blockchain framework is the best-in-class because the token introduced is not considered a token. It is defined as a container, and this container (called the Token Container Model) can hold several rights — from patent rights, usage rights, ownership rights, and so on.

The image-tweet from Nagele Law reveals the token definition and its function:

We are happy to announce that the #Liechtenstein #BlockchainAct has successfully passed through the second reading in Parliament, meaning that the Act has made yet another crucial step towards its anticipated entry into force at the beginning of 2020. pic.twitter.com/qahM3C56nb — Nägele Rechtsanwälte (@NaegeleLAW) October 3, 2019

If anything, this Blockchain Act is setting a new standard not just in terms of regulation but also in creating a framework that other countries can follow. Eventually, as history has shows, startups tend to move to a crypto-friendly country.

With the passing of this act, Liechtenstein will not just be known as the busiest banking street in the world but also as the preferred location for several fintech and blockchain entrepreneurs. In many ways, the country is truly on a mission to lead innovation.