Malta is set to become the first EU member state to regulate blockchain, DLT and cryptocurrencies, since on the 26th June, it was announced that Maltese Parliament has unanimously approved the three legislative bills on blockchain and Distributed Ledger Technology (“DLT”).
The three legislative bills which were approved are:
The Virtual Financial Assets Act (“VFAA”) – which regulates ICOs and services (such as crypto-exchanges) in relation to DLT assets which are classified as Virtual Financial Assets (“VFAs”). VFAs are those DLT assets which do not fall under the definition of Financial Instruments under MiFID II or under the definition of utility tokens, which are referred to in the VFAA as ‘Virtual Tokens’.
The Innovative Technology Arrangements and Services Act (“TAS Act”) – which regulates the recognition and certification of DLT platforms and smart contracts, providing a tangible proof of quality and standards maintained by the relevant DLT platforms. The TAS Act also regulates service providers in relation to these Technology Arrangements, such as auditors and administrators.
The Malta Digital Innovation Authority Act (“MDIA Act”) – which establishes a new central authority, the Malta Digital Innovation Authority (“MDIA”), which will be responsible for supervising, monitoring and reviewing the services provided in Malta in relation to Innovative Technology Arrangements. It was announced that MDIA’s first CEO will be Mr. Stephen McCarthy.
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