Malta is known as the Blockchain Island and is the only country to have provided a set of regulations for operators in the field. Yes, cryptocurrency is legal in the country.
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 globally for crypto and blockchain business.
Malta has already hosted a blockchain summit with organisations and operators from all over the world. Malta is a pioneer in the field. The move to regulate blockchain and crypto is already resulting in economic growth and creating a new niche alongside financial services, aviation, tourism and the iGaming industry.
The Malta Digital Innovation Authority
The Malta Digital Innovation Act established the Malta Digital Innovation Authority. It is to set out internal governance to vet and certify Distributed Ledger Technology platforms. It ensures 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 is the Innovative Technology Arrangement and Services to set up exchanges and other companies operating specifically in the cryptocurrency 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.
The future of cryptocurrency in Malta
Malta has taken a different stance in the field, focusing more on the long-term effects of changing technology 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. In November, the laws will come into effect, and operators are moving swiftly to a foothold on blockchain island.
Recently, a few cryptocurrency currency exchanges set up operations in Malta, citing the country’s progressive policymaking in the sector. These include Binance, OKEx and Bit Bay.
Because Malta is a European Union Member state, all ICOs and other activities must comply with all EU regulations and laws and the General Data Protection Regulation (GDPR).
The future is undoubtedly bright for the Blockchain Island, and Malta could very well become a model for regulation in other countries.