The answer to the question of whether cryptocurrency is legal in Malta is a resounding yes! After all, Malta is known as the Blockchain Island and is the only country to have provided a set of regulations for operators in the field.
On 4 July 2018, Malta’s parliament passed three bills into law, establishing a regulatory framework for blockchain, cryptocurrency and Distributed Ledger Technology. The move has made Malta one of the go to places in the world for crypto and blockchain business.
Malta has already hosted a blockchain summit which saw organisations and operators from all over the world flock to the islands. Malta is a pioneer in the field and the move to regulate blockchain and crypto is already resulting in economic growth and the creation of a new niche to sit alongside financial services, aviation, tourism and the igaming industry.
The Malta Digital Innovation Act established the Malta Digital Innovation Authority to set out internal governance to vet and certify Distributed Ledger Technology platforms to ensure credibility and legal parameters to offer safety to users wishing to use the platform.
The Authority will regulate ICOs and act as a watchdog while also having responsibilities in enacting and enforcing Virtual Financial Assets Act regulations.
The second law – The Innovative Technology Arrangement and Services to set up exchanges and other companies operating specifically in the crypto currency market.
The third law – The Virtual Financial Assets Act – establishes the regulatory framework governing initial coin offerings (ICOs), cryptocurrency exchanges, wallets and similar activities and services.
The laws are based on three fundamental principles – market integrity, consumer protection and industry protection.
Malta has taken a different stance in the field to some other countries, focusing more on the longer term effects of changing technology rather than short term financial gain. Malta’s government has already said that it will review the laws in the future as the technology continues to evolve.
Malta also aims to legislate without stifling the industry, but also providing safety nets. The laws will come into effect in November and operators are moving swiftly to get a foothold on blockchain island.
Recently, a few cryptocurrency currency exchanges including Binance, OKEx and Bit Bay set up operations in Malta, citing the country’s progressive policymaking in the sector.
Because Malta is a European Union Member state, all ICOs and any other activity must comply with all EU regulations and laws, as well as complying with the General Data Protection Regulation (GDPR).
The future is certainly bright for the Blockchain Island and Malta could very well become a model for regulation in other countries in the near future.