- Malta’s futuristic design to be the ‘Blockchain Island’ has suffered a setback beyond expectations: not less than 70% of companies have not applied for a licence. Only 26 countries have applied for one, albeit six months after the deadline. The result? None were granted one.
It was in 2018 when Malta introduced legislation to regulate virtual financial assets and invited companies to operate on Maltese territory during the transition phase after which they had to register. But six months after the deadline, not less than 57 of the 83 companies responding to the lucrative call, did not apply for a licence.
The MFSA, Malta Financial Services Authority, has received just 26 applications, all of them which are still pending and have no licence yet. Meanwhile, the MFSA has published a list of 57 companies that did not apply for a license, six months after the deadline, even though they were given several reminders since November 2019.
The MFSA regulates cryptocurrency exchanges, initial coin offers and wallet providers under the Virtual Financial Services Act (VFSA).
In a statement, the MFSA has clarified that it is aware of a number of entities that “have blundered to either submit a letter of intent to initiate the license application process or a notice of termination of operations. The financial regulator thus warned customers that doing business with unregulated companies poses a great risk to the investors.
Companies that earlier publicly supported Malta’s crypto legislation, such as Binance and Palladium, did not apply for a license either even though Binance was the face of the campaign and Palladium appeared alongside now former, Prime Minister Joseph Muscat, to launch the very first “initial offer of convertible coins”.
Hesitance to regulation is a key characteristic, if not, the most fundamental part of the blockchain, but it can not clarify the initial exuberance of non-compliant businesses to settle under Maltese law. Reports that entities found the VFSA requirements too demanding, are most likely the reason why just 30% of them still support Malta’s “Blockchain Island” dream.
Dear reader, what is your stance on Malta’s blockchain dream? Any thoughts? Let us know!