Copper Markets Liechtenstein Loses TVTG Registration

Copper Markets (Liechtenstein) AG has formally ceased to hold authorisation as a virtual-asset custodian in Liechtenstein. The firm waived its registration under the Token and Trusted Technology Service Provider Act (TVTG) effective 24 September 2026, and the Financial Market Authority Liechtenstein (FMA) confirmed on 14 October 2026 that the registration has expired accordingly. For accounting firms, auditors, and CFOs with digital asset exposure across the EEA and neighbouring jurisdictions, the event is a direct prompt to review counterparty status and ensure that any reliance on Copper Markets (Liechtenstein) AG as a regulated custodian is promptly reconsidered in compliance and financial-reporting workflows.

What the TVTG Registration Framework Requires

Liechtenstein's TVTG, often referred to in English as the Blockchain Act, establishes a registration and licensing regime for token service providers operating in the principality. Among the roles it governs is that of the VT custodian (Verwahrung von Token), which covers firms holding or safeguarding tokens on behalf of clients.

The Relevant Statutory Provisions

The FMA notice references three specific articles of the TVTG:

• Art. 12(1) in conjunction with Art. 2(1)(n): These provisions define the VT custodian role and set out the registration obligation. A firm that takes custody of tokens for third parties must register with the FMA before it can legally provide that service.
• Art. 20(1)(a): This article governs the expiry of a registration. Where a registrant formally waives its registration, the authorisation lapses by operation of law. No separate revocation decision by the FMA is required; the waiver itself triggers expiry.

The distinction between a waiver-triggered expiry and a regulator-initiated revocation matters. A waiver suggests a voluntary business decision by the firm rather than a disciplinary or enforcement action. However, from a counterparty-risk perspective, the legal outcome is identical: Copper Markets (Liechtenstein) AG is no longer authorised to provide VT custody services subject to TVTG registration.

Copper Markets (Liechtenstein) AG: Entity Details

The FMA notice identifies the firm precisely as Copper Markets (Liechtenstein) AG, registered at Dr. Grass-Strasse 12, 9490 Vaduz, with the company identifier FL-0002.728.224-9. Firms conducting counterparty due diligence should use both the legal name and the company identifier when verifying current status, since related entities operating under similar names in other jurisdictions may hold separate licences or registrations that are unaffected by this expiry.

Implications for Accounting Firms and Auditors

When a regulated custodian loses its authorisation, the consequences ripple through several professional disciplines simultaneously. Accounting firms and auditors serving clients with digital asset holdings need to act quickly across at least three areas.

Client Asset Safeguarding and Counterparty Risk Assessment

Any client that used Copper Markets (Liechtenstein) AG as a TVTG-registered custodian should be flagged for immediate review. The core question is whether client assets remain accessible and under what contractual and legal basis they are now held. An entity that is no longer registered cannot rely on the TVTG framework for its operations, which may affect the protections afforded to client assets under Liechtenstein law.

Firms acting as auditors should reassess the completeness and accuracy of their client's disclosures concerning custodial arrangements. If the custodian's regulated status formed part of the basis for management's assertions about internal controls or asset security, those assertions may need to be revisited. Audit teams should document the change in status and consider whether any subsequent events disclosure is warranted in financial statements for periods ending on or after 24 September 2026.

Accounting Treatment and Financial Reporting

Under IFRS, digital assets held in custody with a third party are typically recognised on the balance sheet of the beneficial owner, not the custodian. The change in the custodian's regulatory status does not, in itself, alter the recognition or measurement of those assets. However, it does affect the quality of disclosures required under IFRS 7 (Financial Instruments: Disclosures) and IAS 1 (Presentation of Financial Statements).

Specifically, IFRS 7 requires disclosure of risks arising from financial instruments, including credit and concentration risk. Where a client's assets were held by a now-unregistered custodian, the risk profile of that custodial arrangement has changed materially. CFOs and finance teams should review their IFRS 7 risk disclosures and consider whether qualitative narrative in the notes requires updating for interim or annual periods that straddle the 24 September 2026 effective date.

AML and KYC Obligations

Firms subject to AML obligations in their own jurisdictions must also consider the counterparty classification consequences. A TVTG-registered VT custodian would typically be treated as a regulated financial institution for the purposes of simplified due diligence thresholds under the EU's AML framework and comparable national rules. Once that registration lapses, the entity no longer qualifies for those simplified thresholds. Any firm that applied reduced due diligence on the basis of Copper Markets (Liechtenstein) AG's registered status must revert to standard or enhanced due diligence procedures immediately.

For firms operating in Luxembourg — a key EEA hub for fund services and digital asset administration — this is particularly relevant. Luxembourg-domiciled AIFs, SICAVs, and their service providers that interacted with Copper Markets (Liechtenstein) AG as a registered custodian should update their counterparty risk registers and AML files without delay. The Commission de Surveillance du Secteur Financier (CSSF) expects firms to maintain current and accurate records of the regulatory status of all counterparties.

Practical Steps for CFOs and Compliance Teams

Immediate Actions

The following steps are relevant for any firm or fund that had a direct or indirect relationship with Copper Markets (Liechtenstein) AG in its capacity as a TVTG-registered VT custodian:

• Verify current asset locations and confirm that custodial arrangements have either migrated to an authorised entity or are being managed under an alternative legal framework.
• Update counterparty registers to reflect the expired registration status, with the effective date of 24 September 2026 and the source citation being the FMA Liechtenstein public notice.
• Reassess the AML/KYC classification of the entity and apply standard or enhanced due diligence as appropriate from the effective date forward.
• Notify auditors and external counsel of the change so that financial statement disclosures and audit working papers can be updated accordingly.
• Review any contractual provisions that required the custodian to maintain its TVTG registration as a condition of the service agreement, and assess whether a breach or termination right has been triggered.

Longer-Term Compliance Considerations

This event is a timely reminder that regulatory status for token service providers in Liechtenstein — and by extension across jurisdictions applying the TVTG's mutual recognition potential within the EEA framework — is dynamic. Registrations can be waived, suspended, or revoked. Firms that rely on third-party custodians for digital asset safeguarding should build periodic verification of regulatory status into their ongoing due diligence cycles, rather than treating an initial authorisation check as a permanent clearance.

Robust crypto accounting software can assist by flagging changes in the regulatory status of custodial counterparties as part of automated counterparty monitoring routines. However, the interpretation of those flags and the resulting adjustments to AML files, audit working papers, and IFRS disclosures remain professional judgements that must be made by qualified practitioners.

Firms should also monitor the FMA's public register of TVTG service providers on an ongoing basis. The FMA publishes additions, changes, and expirations as they occur, making the register a reliable primary source for counterparty status verification in Liechtenstein.

Broader Context: TVTG Enforcement and Market Signals

Liechtenstein was among the earliest jurisdictions globally to enact a comprehensive statutory framework for token service providers, with the TVTG entering into force in 2020. The regime covers a wide range of token service provider roles, from token issuers and token generators through to VT custodians and VT exchange services. The FMA maintains active oversight of the register, and public notices of expirations — whether voluntary or otherwise — are a routine part of that oversight function.

The voluntary nature of this particular expiry does not diminish the compliance obligations it triggers for counterparties. If anything, a voluntary waiver can sometimes indicate a commercial restructuring, a business wind-down in a specific jurisdiction, or a migration of activities to another legal entity or regime. None of those scenarios eliminates the need for immediate counterparty due diligence action by affected firms.

For the broader digital asset market in the EEA, this notice also serves as a reminder that the TVTG framework coexists with the incoming Markets in Crypto-Assets Regulation (MiCA). As MiCA's full provisions come into effect, Liechtenstein will need to align its TVTG framework with the pan-European requirements, and firms operating across both regimes should track how the FMA manages that transition. Registrations and licences granted under the TVTG will not automatically translate into MiCA authorisations, making this an area of ongoing regulatory complexity for cross-border digital asset businesses.

Frequently Asked Questions

What does it mean that Copper Markets (Liechtenstein) AG waived its TVTG registration?

The firm voluntarily surrendered its registration as a VT custodian under Liechtenstein's TVTG. Under Art. 20(1)(a) of the TVTG, a voluntary waiver causes the registration to expire by operation of law. The firm is no longer authorised to provide VT custody services requiring TVTG registration as of 24 September 2026.

Does this affect client assets held by the firm?

The expiry of the registration does not automatically affect the legal ownership of assets held in custody; beneficial owners retain their property rights. However, the regulatory protections associated with a TVTG-registered custodian no longer apply, and firms should urgently verify where their assets are held and under what legal framework.

What AML/KYC changes must firms make following this expiry?

Firms that applied simplified due diligence to Copper Markets (Liechtenstein) AG on the basis of its TVTG-registered status must revert to standard or enhanced due diligence from 24 September 2026. Counterparty risk registers and AML files should be updated to reflect the expired status, citing the FMA public notice as the source.

Are there IFRS disclosure obligations triggered by this event?

Potentially yes. If digital assets were held with this custodian, the change in the custodian's regulatory status is relevant to IFRS 7 risk disclosures and may require qualitative narrative updates in financial statements. Finance teams should also consider whether the event constitutes a subsequent event requiring disclosure under IAS 10 for any reporting period ending on or near 24 September 2026.

How does this interact with MiCA for EEA-based firms?

MiCA and the TVTG are separate frameworks. A TVTG registration does not confer MiCA authorisation, and vice versa. As MiCA's full requirements take effect, firms relying on Liechtenstein-registered custodians should monitor how the FMA handles the transition and ensure that any replacement custodial arrangements are authorised under the applicable regime for the services being provided.

Source: FMA Liechtenstein