Malta Positions itself as Industry Leader with New Cryptocurrency Regulations

By Company Registrations Worldwide, 23rd Aug 2018 (Updated 24th January 2020)

Update: As of January 2020 the Malta Financial Service Authority (MFSA) has failed to issue any licences to Maltese Cryptocurrency Companies. 

Cryptocurrencies include digital currency, virtual currency or alternative currency. The main feature of these currencies is decentralised control; instead of using a centralised electronic money or central banking system. Decentralized control of each cryptocurrency works through various data ledger technology (DLT) types such as a blockchain, serving as a financial transaction database.

Because of the decentralised nature of cryptocurrencies, many countries shy away from attempting to regulate cryptocurrencies or even allowing businesses that carry out such activities to incorporate there. But on the 4 July 2018, the Maltese government unanimously passed new regulations for cryptocurrency businesses to attract a new economic sector to their marketplace. The new regulations are aimed at positioning Malta as a cryptocurrency leader and establishing the country as the most desirable location to operate blockchain enterprises.

Three cryptocurrency and blockchain bills have been approved detailing the regulation of ICOs and cryptocurrencies as well as the process for incorporating crypto businesses in Malta.

Malta’s Cryptocurrency Regulation

  1. Virtual Financial Assets (BFA) Act will regulation initial coin offerings (ICO). Companies that intend to raise capital through ICOs will need to publish white papers with a detailed description of the entire project. These issuers will also be expected to disclose their financial records to the public.
  2. Malta Digital Innovation Authority (MDIA) Act outlines regulatory procedures for the cryptocurrency and the blockchain industry. This includes the establishment of the Malta Digital Innovation Authority (MDIA) which will act as the regulatory body for the crypto industry.
  3. Innovative Technology Arrangements and Services (ITAS) Act details the registration and certification of service providers with a focus on the registration of cryptocurrency exchanges in Malta. Industry insiders believe this bill was created to position Malta as a hotspot for cryptocurrency exchanges.

Malta is among the first European Countries to move toward a regulated cryptocurrency business jurisdiction. The new Acts are expected to guide the government as it embraces the new technology and achieve its aim of becoming a hotspot for crypto and blockchain businesses.

There are many benefits to forming a company in Malta, it has the lowest corporation tax rate in Europe, only 5%. The experts at Company Registrations WorldWide can assist you to navigate Malta’s cryptocurrency regulations and to establish your Maltese Cryptocurrency Company. Please contact us today for more information.