Malta’s ‘Blockchain Island’ Plan Progresses by Passing a Law on Blockchain Technology
By Annebeth Wijtenburg, United Kingdom
This week the Maltese government passed a law that sets out a regulatory framework for blockchain, cryptocurrency and Distributed Ledger Technology (DLT), aiming to make Malta one of the most favourable destinations to set up businesses in the blockchain space.
The government passed three bills into a law, making it a worldwide first for a government to have a regulatory framework for operators of blockchain technology, crypto companies and DLT in a country.
The three bills the government passed, the Malta Digital Innovation Authority Act, the Innovative Technological Arrangement and Services Act, and the Virtual Financial Asset Act, should provide blockchain operators with all the tools to manoeuvre in the regulated sphere.
According to Malta’s Junior Minister for Financial Services, Digital Economy and Innovation within the Office of the Prime Minister of Malta, Silvio Schembri, the ultimate aim of the passing of the bills “is to bring legal certainty to an environment that is currently unregulated.”
Schembri further called the law a milestone for the country and noted that the country “based these laws upon 3 basic principles – market integrity, consumer protection and industry protection”.
That Malta is considered an attractive hub for blockchain and cryptocurrency businesses is not new. The government is known for its favourable approach to the new technologies, gaining the country the name of the ‘blockchain island’. Especially exchanges have set up their operations on the Mediterranean island, including OKex, Binance and Bitbay, because of the country’s welcoming approach to blockchain and crypto.
Furthermore, the country certainly distinguishes itself from other countries by investing heavily in technical expertise within the government on all things blockchain, which sets them up well for being the first country to pass this law and manage the regulatory framework accordingly, without stifling innovation and entrepreneurship.
If anything, the government hopes to stimulate economic growth with the new law and spur on investors as the law means that companies will have the framework to operate in a regulated environment.