Malta is moving a step closer to being a cryptocurrency haven with the cabinet approving three bills relating to cryptocurrencies and blockchain technology. One of the bills known as the Virtual Financial Assets Bills provides a legal framework for cryptocurrencies as well as ICOs. The bill is meant to provide some stability to the cryptocurrency market.
This and three other bills went through the first reading on Tuesday, a stage that precedes a formal debate on parliament. If approved, it will pass into law. Amendments may also be made.
“Once new laws surrounding blockchain technology and cryptocurrency are enacted in Malta, banks would be less reluctant to welcome companies working in the industry, presumably due to the legal certainty it would provide,” Malta Independent quoted Silvio Schembri, the parliamentary secretary for Financial Services, Digital Economy and Services as saying.
Binance, a major cryptocurrency exchange based in Hong Kong is one of the companies planning to move to Malta as it is generally considered a cryptocurrency friendly jurisdiction.
Protect Investors
According to Schembri, the legal framework is meant to ensure that investors are protected as well as provide market integrity.
If the bill becomes law, a new body to be known as the Malta Digital Innovation Authority will be formed as per the Malta Digital Innovation Authority Bill. The agency will be charged with certifying cryptocurrency companies wishing to operate in the country. Its duties and responsibilities are already outlined in the bill. The internal governance arrangements are also spelled out in the bill.
The Technology Arrangements and Services Bill is concerned with technology service providers in the space.
The country is looking at capitalising on the huge interest it has generated from exchanges worldwide. Other countries are still far behind in terms of providing some clarity on how the nascent sector will be regulated. Many have instead focussed on cracking it down.
The bill now gives the financial services authority powers to require certain information from operators, suspend an ICO and even the trading of certain coins on exchanges.