Malta’s Financial Services Authority to Revise Cryptocurrency Regulations
The Financial Services Authority in Malta has taken steps to revise its cryptocurrency regulations in order to align them with the upcoming European Markets in Crypto-Assets (MiCA) regulations, which will be effective from December 2024. This move by Malta aims to bring about changes in its regulations governing exchanges, custodians, and portfolio managers to ensure compliance with the MiCA framework of the European Union. Other EU countries, including France, have also introduced new rules in line with MiCA.
The View from Malta
Malta initially established its cryptocurrency framework in 2018 with the Virtual Financial Assets (VFA). The updated regulations will include the removal of the systems audit requirement for VFA license holders and a reduction in capital requirements for certain license holders. Additionally, professional indemnity insurance will no longer be required. The rulebook will also integrate service-specific rules from MiCA into the VFA rulebook, resulting in amendments to requirements for exchanges, order execution, and client suitability.
A Step Towards Stronger Regulation
A public consultation is currently open until September 29, allowing all interested parties within Malta to participate. The introduction of MiCA regulations is an important step for the industry, especially considering the ongoing regulatory uncertainty in the United States. Prior to these regulations, the European crypto market had varying rules and approaches across member states.
Hot Take: Streamlining Cryptocurrency Regulations for Enhanced Compliance
Malta’s Financial Services Authority is taking proactive measures to revise its cryptocurrency regulations and align them with the forthcoming MiCA regulations of the European Union. By doing so, Malta aims to bring about changes that will enhance compliance among exchanges, custodians, and portfolio managers. This step not only aligns Malta with the EU’s regulatory framework but also contributes to streamlining regulations in the European crypto market, which previously had varying rules across member states. The integration of service-specific rules from MiCA into Malta’s cryptocurrency framework will ensure clearer guidelines for exchanges, order execution, and client suitability. All interested parties have the opportunity to participate in the public consultation, further emphasizing Malta’s commitment to transparent and inclusive regulatory processes.
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