It appears that the blockchain industry and cryptocurrency is once again picking up in Malta after a slight hiatus with yet another interesting announcement. Binance, the world’s largest cryptocurrency exchange by daily trading volume has announced a partnership with the Malta Stock Exchange to launch a new digital exchange specifically for security token trading.
The agreement was signed earlier today through a memorandum of understanding between MSE chairman, Joseph Portelli and Binance chief financial officer, Wei Zhou. The Minister for Finance, Prof Edward Scicluna was also in attendance. Scicluna has been notably absent from the blockchain and crypto scene in Malta which is usually the prerogative of the energetic Junior Minister Silvio Schembri.
The new trading platform will leverage the stock exchange’s 26-year track record of operating as a regulated stock exchange, with the associated regulatory compliance, while building on Binance‘s business model and global reach.
Addressing a press conference after the signing of the agreement, Scicluna described the technology as revolutionary and one that would change the world. He said Malta won’t let any opportunity pass it by, insisting that it would have been “crazy” not to establish itself in this area.
Like many other new technologies, blockchain and cryptocurrencies are not without their risks, Scicluna acknowledged.
“This is not an excuse to let it go by and be taken up by others,” the minister said, stressing that Malta was taking the “prudent route”.
Scicluna said that MSX PLC, the fintech and digital asset subsidiary of the Malta Stock Exchange, had been set up specifically for such ventures.
He said that “this type of service” fit well with a small open economy like Malta.
Scicluna also stressed the need for transparency and effective measures to combat money laundering, as well as respecting consumer rights, explaining that the difference between Malta and other jurisdictions was that Malta had recognised that a new technology needs new regulations.
Turning to Malta‘s new digital ledger technologies legislation, Scicluna said that some of the best legal brains had commended Malta‘s approach in dealing with the new sector.
The minister said he hoped that Malta would have the same success it had with the gaming sector following the establishment of the Malta Gaming Authority.
However, sources said that the legislative framework that was proposed for the three blockchain bills includes some onerous requirements that will be considerably difficult to fulfil if business is to really take off. The current market slump in the cryptocurrency markets is also affecting investor confidence.
Portelli said the government had shown itself to be a trailblazer in the blockchain space, adding that “whether you like it or not, the technology is here to stay”.
“We look forward to seeing this exciting new market opportunity develop admonish the boundaries of the Maltese financial sector,” he said.
Portelli insisted that security token exchanges would become common the world over in a few years.
On his part Zhou thanked the Maltese government and the Malta Stock Exchange for the possibility to work on a “revolutionary project”.
He said that Binance were there to offer people complete freedom with their money and investments.
Zhou said the company was very happy with the reception it received in Malta and the regulations put in place in order for the blockchain ecosystem to flourish.