According to a March 1 report by The Malta Times, cryptocurrency companies in Malta are facing difficulties opening bank accounts. Several local law firms and financial institutions confirmed that banks are rejecting cryptocurrency-related clients, citing "exceeding risk tolerance thresholds."
Banking Restrictions on Crypto Firms
Parliamentary Secretary for Financial Services Silvio Schembri explained that while some banks accommodate blockchain companies, they avoid cryptocurrency operators entirely. Schembri emphasized the need to distinguish between blockchain service providers and cryptocurrency businesses.
Schembri noted that banks typically require cryptocurrency operators to obtain licensing from the Malta Financial Services Authority (MFSA) before initiating account procedures—a precaution he described as "understandable."
Malta’s "Blockchain Island" Reputation
Malta, known as the "Blockchain Island" for its crypto-friendly policies, hosts major exchanges like OKEx, Binance, and BitBay.
👉 Discover how Malta leads in blockchain innovation
Regulatory Developments
In February, the MFSA issued Cybersecurity Guidelines recommending adherence to international standards, including the European Banking Authority’s (EBA) framework. The guidelines reference the Cryptocurrency Security Standard (CCSS), established in 2014, to enhance crypto asset security.
Key Targets of the Guidelines:
- Professional funds investing in virtual assets
- Issuers and VFAA (Virtual Financial Assets Act) agents
- Intermediaries facilitating client-regulator interactions
EU-Wide Blockchain Advocacy
In December 2023, Malta spearheaded a joint declaration with six EU nations (Italy, France, Cyprus, Portugal, Spain, and Greece) to promote distributed ledger technology (DLT). The declaration highlighted blockchain’s potential to:
- Streamline government processes
- Safeguard citizen privacy
- Revitalize Southern Europe’s economy
FAQ Section
Q: Why are Maltese banks rejecting cryptocurrency companies?
A: Banks cite risk management concerns, often waiting for MFSA licensing approval before engaging with crypto firms.
Q: What distinguishes blockchain from cryptocurrency operators in Malta?
A: Blockchain firms focus on DLT infrastructure, while crypto operators handle asset trading—banks currently favor the former.
Q: How does Malta’s regulatory framework support blockchain growth?
A: Through progressive policies like the VFAA and alignment with EU cybersecurity standards.
👉 Explore Malta’s crypto regulations in depth
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