Malta and Cryptocurrency

Malta Cryptocurrency Laws
Regulation of Digital Currencies: Cryptocurrency, Bitcoins, Blockchain Technology

Malta currently does not have any legislation that specifically applies to cryptocurrency, but this will soon change.  The Maltese government has actively encouraged the development of cryptocurrency and issuing many consultations and papers that discuss its regulation and development.  The aim of these regulations is “[t]o provide the necessary legal certainty to allow this industry to flourish.”[264]

In October 2017, the government issued a consultation document that proposed a regulatory framework for collective investment schemes and investment in cryptocurrencies.  As a result of the consultation, Malta Financial Services Authority (MFSA) published conditions that apply to professional investor funds that invest in cryptocurrencies on January 22 and 29, 2018.[265]

In November 2017, the government published the Discussion Paper on Initial Coin Offerings, Virtual Currencies and Related Service Providers, which noted that while some cryptocurrencies might fall within the scope of existing financial services legislation, others would be outside the scope and thus unregulated.[266]  In January 2018, the government issued a further discussion paper that “present[ed]a conceptual framework through which DLT Platforms can be subject to certification in Malta.”[267]  The government has issued a statement that it intends to facilitate a regulatory framework for cryptocurrency-related activities and initial coin offerings (ICOs).[268]

Malta is currently considering three bills that would provide a regulatory framework for cryptocurrency and is following a principles-oriented approach to this legislation to help prevent the laws from becoming rapidly obsolete, or from stifling technological development.[269]  The three bills are as follows:

  • The Malta Digital Innovation Authority Bill (MDIA Bill) would establish the Malta Digital Innovation Authority (MDIA), which would “focus on innovative technology arrangements and their uses such that Malta can take the greatest advantage of new technology arrangements while at the same time protect[ing] the public interest.”[270]  One of the first objectives for the MDIA would be to promote government policies that favor technical innovation, particularly with reference to digital ledger technology and its adoption by the government in systems of public administration.[271]  Other objectives would include maintaining Malta’s reputation and protecting consumers.[272]  The MDIA would also bear responsibility for certifying technology arrangements and registering technology services providers under the “TAS Bill.”[273]
  • ·The “TAS Bill” would establish a regime for the registration of technology service providers and provide for the certification of certain technology arrangements.  This regime will initially cover distributed ledger technology platforms and related contracts.[274]  The proposals would require technology service providers that provide services for any distributed ledger technology platform in or from Malta be certified by the MDIA. Those who provide these services in other specified cases may voluntary register with the MDIA.[275]
  • The Virtual Currency Bill would establish a framework for ICOs and a regulatory regime that would apply to certain services relating to cryptocurrencies, such as brokers, wallet providers, and virtual currency exchanges.[276] The Times of Malta has reported that the government is considering introducing its own cryptocurrency “within a ‘controlled framework,’ which would enable regulators to test possible controls and legislation for the technology.”[277]  The Virtual Currency Bill aims to regulate ICOs that relate to virtual currency not falling within the existing legislation.  The bill will ensure that the offerings meet transparency requirements and will incorporate obligations that apply to initial public offerings that the issuer must follow.[278]

The MFSA has also proposed a “financial instrument test” that would enable individuals to determine,

with regulatory certainty[,] . . . whether, based on its specific features, an ICO or a VC [virtual currency] falls within the scope of the existing legislative framework, reflecting EU law on the subject, or if not, whether this will be required to comply with the new regulatory framework being proposed by the MFSA.[279]

The test proposed would be a two-stage test, the first of which would determine whether a cryptocurrency is a financial instrument within existing Maltese or European Union legislation.  The second stage would determine if the cryptocurrency was an asset under the proposed Virtual Currency Bill.[280]

The MFSA would be the regulator for the financial services contained in the Virtual Currency Bill, and would have regulatory and investigatory powers that reflect those contained in the country’s other financial services laws, including the authority to suspend an ICO or trading of a cryptocurrency.[281]

The government has also established a National Blockchain Strategy Taskforce to advise the government on a framework for distributed ledger technologies.[282]

After one of Malta’s largest banks, the Bank of Valletta, blocked cryptocurrency transfers,[283] the government of Malta stated that it does not “interfere with individual banks’ operational policies, which are dictated by circumstances which they are best placed to assess.”[284]  Many residents of Malta expressed surprise at the actions of the Bank, particularly as the government of Malta is its largest shareholder, owning approximately 25% of the Bank’s shares.[285]

The Malta Gaming Authority has also stated that it is “committed to allow[ing] the use of crypto-currencies by its licensees in the immediate future,”[286] and a new Gaming Bill is currently being considered that includes virtual currencies under the definition of “money and, or money’s worth.”[287]

P.S. Insights on Cryptocurrency Legal Issues

Most jurisdictions and authorities have yet to enact laws governing cryptocurrencies, meaning that, for most countries, the legality of crypto mining remains unclear.

Under the Financial Crimes Enforcement Network (FinCEN), crypto miners are considered money transmitters, so they may be subject to the laws that govern that activity. In Israel, for instance, crypto mining is treated as a business and is subject to corporate income tax. In India and elsewhere, regulatory uncertainty persists, although Canada and the United States are relatively friendly to crypto mining.

However, apart from jurisdictions that have specifically banned cryptocurrency-related activities, very few countries prohibit crypto mining.

Our Freeman Law Cryptocurrency Law Resource page provides a summary of the legal status of cryptocurrency for each country across the globe with statutory or regulatory provisions governing cryptocurrency.  The globe below provides links to country-by-country summaries:


The Freeman Law Project – Cryptocurrency Regulation and Taxation: A Brief Primer

Is cryptocurrency legal in Malta?

Do you have questions about cryptocurrency, digital currencies, or blockchain technology?
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[264] Ivan Martin, Malta Digital Innovation Authority Unveiled: Government Working on Green Paper on AI and Internet of Things, Times of Malta (Feb. 16, 2018), local/malta-digital-innovation-authority-unveiled.670847, archived at

[265] Parliamentary Secretariat for Financial Services et al., Malta: A Leader in DLT Regulation 9 (2018), available at FSDEI – DLT Regulation Document OUTPUT.PDF, archived at

[266] MFSA, Discussion Paper on Initial Coin Offerings, Virtual Currencies and Related Service Providers, MFSA Ref: 08-2017 (Nov. 30, 2017; closing date Jan. 11, 2018), DiscussionPaperVCs.pdf, archived at

[267] Id.

[268] Press Release, Parliamentary Secretariat for Financial Services, Digital Economy and Innovation, PR172729 (Nov. 29, 2017),, archived at

[269] Parliamentary Secretariat for Financial Services et al., supra note 265, at 265.

[270] Id. at 11.

[271] Id. at 12.

[272] Id.

[273] Id.

[274] Id. at 13.

[275] Id. at 14.

[276] Id.

[277] Id.

[278] Id. at 26.

[279] Id. at 24.

[280] Id.

[281] Id. at 26.

[282] Id. at 9.

[283] Bertaind Borg, BOV Turns Against Cryptocurrencies, Times of Malta (Nov. 28, 2017), https://www.timesof, archived at

[284] Press Release, Parliamentary Secretariat for Financial Services, Digital Economy and Innovation, supra note 268.

[285] Borg, supra note 283.

[286] Malta Gaming Authority, A White Paper to Future Proof Malta’s Gaming Legal Framework 28 (July 2017), Overhaul Consultation with Annexes.pdf, archived at

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