Twenty-one cryptocurrency exchanges are among the 34 prospective financial services providers that have applied for an operating license in Malta. The companies were all operating under the transitory provisions set out in the Virtual Financial Assets Act. The transitory period expired on October 31, and those wishing to continue operating in the European country have to apply for the license from the Maltese regulator.
In its announcement, the Malta Financial Services Authority (MFSA) revealed that it had received the application letters from the exchanges, but this was just the first step. The regulator explained, “The Authority shall shortly be contacting the applicants in order to set up a preliminary meeting. Once this meeting is held, applicants will have 60 days to submit a full application pack to the MFSA.”
Those that apply for the license will be classified into four categories at the discretion of the regulator, a report by Finance Magnates revealed. The groups all have different requirements for their members. The authority also issued a notice informing the applicants of what would befall them should they fail to fully comply with the provisions.
Malta was one of the first country to regulate cryptocurrencies, passing the Virtual Financial Assets Act in November 2018. The Act outlined “a comprehensive framework targeting operators within the crypto-asset industry and seeks to regulate entities providing services in relation to crypto-assets.” It encompassed every facet of the industry, from crypto exchanges and brokerages, to investment advisors and portfolio managers, crypto custodians to wallet providers.
The country has continued to champion for blockchain and crypto, earning itself the moniker of ‘The Blockchain Island.’ The friendly regulations have led to a growth in the number of crypto companies in the country, with some of the major global firms also setting up offices in the country.