Malta’s Banks Refuse to Open Accounts For Crypto Companies

Cryptocurrency Europe Malta
Despite Malta’s crypto-friendly regulations the crypto businesses which set up shop in the country are now having difficulty opening local bank accounts.

Hailed as “The Blockchain Island” and a regulatory safe-haven for the blossoming cryptocurrency and blockchain industry, Malta has surged to the front in the race to become the leading global crypto hotspot and attracted some major players to its shores.

Now, despite all this, the crypto and blockchain businesses which chose Malta as their preferred destination are having problems with… opening accounts with local banks.

As reported by The Times of Malta, cryptocurrency and blockchain related companies are struggling to open bank accounts with Maltese banks. According to the report, representatives of the companies had their applications for bank accounts declined by local banks, which consider their line of business too risky.

“Banks were politely declining their business, saying it was outside their “risk appetite,” reported the Times of Malta.

Moreover, local banks often see no distinction between cryptocurrency-focussed and blockchain technology-focussed businesses.  

Responding to the report Parliamentary Secretary for Financial Services Silvio Schembri, a staunch advocate of the crypto industry within the Maltese government, said that a clear distinction should be made between blockchain operators and crypto operators and added that in order to establish a better understanding of the industry, he was meeting with banks and other involved parties.

Malta's Parliamentary Secretary for Financial Services, Silvio Schembri.

Malta’s Parliamentary Secretary for Financial Services, Silvio Schembri.

Schembri explained that Maltese banks usually require cryptocurrency operators to obtain a license with the Malta Financial Services Authority (MFSA) before offering them their services “Which is understandable,” he added.

As reported by The Times of Malta, 28 applications for registration as VFA Agents under the Virtual Financial Assets Act have been filed with MFSA since November 2018 and the agency aims to license the first operators this month.

“As Malta’s first line of the defense, the MFSA’s assessment with regard to VFA Agent applications is thorough and includes inter alia a rigorous competence assessment as well as checks on the applicants’ proposed governance and business model,” the Times of Malta was told by a MFSA spokesman.

About the author

Maciek Klimowicz

Maciek Klimowicz

A seasoned writer and editor with 10 years of experience in a variety of print and online media. Recognizing the transformative potential of the blockchain technology, Maciek has now put his pen to work to explore the key issues of this fast-evolving sector. Contact him on [email protected].

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