The main attraction for blockchains to be installed on the “blockchain island” is precisely that the laws are more “favorable” and little regulated, because the regulatory process is slow
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Friday, September 13
Get to know the “blockchain island” and why it worries financial regulators
Malta is currently called the “island of the blockchain” since in 2017 decided to become a global enclave for cryptocurrencies. However, the fact that there is not enough regulation for this financial activity has worried some financial institutions, possibility of the crime of money laundering and any other financial crime.
From the 2017 and throughout the 2018 several blockchain companies settled in Malta to operate from the island, including Binance, because the laws were more favorable and not very regulatory. It is believed that at least $ 71 One billion dollars have passed through Malta since then.
In this regard, financial experts met in Paris and discussed include the “blockchain island” in a list of countries that do not comply with regulatory obligations to stop financial crime.
FATF, Financial Action Task Force is the group that has been concerned about crypto activity in Malta and assures that above all applies the law in the country . This group has 37 jurisdictions and two regional organizations.
It should be noted that when blockchain companies began to settle on the island, they were granted a one-year grace period, that is, they could operate without a license for that period. And for Gafi it has been problematic, it is the initial impulse to attract cryptocurrency companies.
During that “grace” period there was an explosion of transactions considered high risk and executed by exchanges without any license.
At the moment, Malta is still considered a great destination for cryptocurrency trading, that is why it is still called the “blockchain island”, for example crypto.com recently obtained a “class 3” license, becoming the first platform
This license was granted by the Malta Financial Services Authority, and this makes Crypto.com subject to more stringent requirements from the government when it comes to security and compliance. Before this, Crypto operated on the island with a temporary legal framework.
Although since 2020 the Maltese government proposed to move away from its blockchain agenda and adopt more a digital system, for this they sought a advisory body, the Digital Economy Think Tank: “we are moving more towards a digital island because we believe in a holistic vision that includes all technological aspects “, the company assured at the time.
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