Aligning with MiCA: Malta Proposes Changes in Its Crypto Rules

<p dir="ltr">Malta’s Financial Services Authority (MFSA) has moved towards aligning the island’s existing cryptocurrency regulations with Europe’s Markets in Crypto-Assets (MiCA) regulations, which will come into effect in December 2024. The MFSA has launched a public consultation until 29 September on the proposed changes.</p><p dir="ltr">Crypto Regulations in Malta</p><p dir="ltr">Malta was one of the early jurisdictions to adopt crypto regulations with the establishment of its Virtual Financial Assets (VFA) framework in 2018, aiming to attract companies in the booming industry to the island. Although some big names initially moved to <a href="https://www.financemagnates.com/tag/malta/">Malta</a>, the program failed to attract the masses.</p><p dir="ltr">Now, the proposed changes to align its requirements with <a href="https://www.financemagnates.com/tag/mica/">MiCA</a> will ease many existing rules. One of the highlighted changes is removing the systems audit requirement for VFA license holders. Further, the capital requirements for Class 3 and 4 license holders were reduced to 125,000 euros and 150,000 euros, respectively. It also removed the professional indemnity insurance requirement.</p><p dir="ltr">Other proposed changes include updating outsourcing requirements to align them with MiCA and incorporating the service-specific rules of MiCA into the local VFA framework. The proposed changes removed the existing requirements relating to client categorization and the need for <a href="https://www.financemagnates.com/terms/r/risk-management/">Risk Management</a> as well as the Internal Capital Adequacy Assessment Report.</p><blockquote><p lang="tl" dir="ltr">Crypto Tax Free Countries:- United Arab Emirates