Mouthful from Malta: Country’s MFSA Virtual Financial Assets Act Approves First 14 Crypto Licenses
Malta is undoubtedly doing everything right to ensure that they create a blockchain island in the country.
If at all you had any questions as to why several high-profile, as well as crypto businesses, are making their way into Malta, then those questions must have been well answered with the activities taking place in the country.
Today, April 2, the Malta Financial Services Authority (MFSA) has released a statement saying that it has approved 14 Virtual Financial Assets (VFA) agents. The announcement comes 17 weeks after the first application was filed.
In the released statement, MFSA states that all the 14 firms have not yet fully completed the process of application and hence they have only been granted in-principle approvals.
According to Dr. Christopher Buttigieg, the head of securities and markets at MFSA, the issuance of the in-principle approvals is a significant milestone for their efforts of becoming a regulator of excellence as far as regulation of crypto assets is concerned.
The agents are a significant component of Malta's nascent crypto and blockchain regulations. Any firm based in the country and wants to sell tokens to investors will first have to get a mix of legal as well as financial approval and advice. That's the point where the VFA agents come in to help.
As per the country's Virtual Financial Assets Bill that came into effect midway of June last year, any company has to appoint a VFA agent to confirm and ensure, through a joint signing, that the company doesn't violate any financial services or the crypto regulations.
The requirement has been put in place by MFSA and aims to protect anyone with interest to invest in cryptocurrencies.
The approved agents now are obliged to evaluate their various customer's business plans to ensure they get appropriately prepared before submitting applications to MFSA. Furthermore, they have to undertake due diligence with clients to check whether they all comply with Anti-Money Laundering (AML) as well as counter-terrorism financing guidelines.
Banks are Reluctant
The fact that Malta has done a lot, as well as cryptocurrencies, are concerned, one issue remains: banks are reluctant to open accounts for clients. Several companies in cryptocurrency and blockchain have hit the wall when trying to open the bank accounts.
However, some sources have reported that the banks politely are declining their business as they say it's beyond their “risk appetite.” In fact, Parliamentary Secretary for Finance Services Silvio Schembri has gone on to mention that banks were only waiting for the operators to obtain MFSA license before opening the doors.
Malta is, alongside Gibraltar, becoming a hub for cryptocurrency industry and with this pace, the island-nation may pull all investors as they have already a form of regulation governing blockchain and cryptocurrency industries.