The Malta Financial Services Authority (MFSA) has officially published a rulebook for Virtual Financial Assets (VFA). The rules specifically look to affect the monitoring of VFA issuers, falling under the Virtual Financial Assets Act (VFAA).
However, this new rulebook hasn’t been very popular among many providers of financial services. Many state that it is essentially “over-cautious” and make business with blockchain and digital currencies more complex. Partner at WH Partners Joseph Borg has explained that while this publication might be a positive move, it needs much more refinement to actually work. He said:
“I strongly suggest to stakeholders to participate in this consultation in order to help the MFSA come up with a well-balanced regulatory framework that is robust and attractive at the same time. It is clear that some things published in the rule book need to be polished and, in some cases, toned down.”
Dr. Simon Schembri, stakeholder at Ganado Advocates also spoke to reporters about the publication, talking about its framework and build in particular. He explained:
“There are some issues which merit further discussion with the regulator, and in fact, as interested parties in this space, we have already provided our feedback for relative amendments and clarifications within the time frame of the conclusion of the first consultation period relative to the first chapter.”
He said that they were currently in process of reviewing a paper on the second chapter, and the firm would provide its feedback to regulators soon.
Several other investors had the opposite opinion, stating that the rulebook required drastic revision in order to work, and was unusable in its current state.
The MFSA had originally drafted and forwarded the VFAA to the Maltese government after seeing the positive feedback to their proposal to introduce new laws in order to regulate ICOs, as well as the provision of several services pertaining to digital currencies and blockchains.
The government is now in the process of framing new regulations that will complement the provisions of the VFAA and the Virtual Financial Assets Regulations. These new rules will provide clarity to regulators and investors in both operations in the space of finances.