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Maltese Financial Regulator Will Actively Monitor Cryptocurrency Firms

The Malta Financial Services Authority (MFSA) says in its recently published strategic plan that it will actively monitor and manage business-related risks related to cryptocurrency firms.

Monitor crypto firms to prevent crypto-related crimes

On Sept. 6, the MFSA published its three-year strategic plan for 2019–2021 which states the Malta financial regulator will strive to modernize their regulatory approach to be one step ahead of industry developments.

The MFSA said it will work closely with the Financial Intelligence Analysis Unit and other national and international authorities, including the newly formed Malta Digital Innovation Authority. The regulator added:

“Whilst Malta has taken unprecedented steps in bringing blockchain and crypto technology into the regulatory fold, we understand that such innovations present challenges in the prevention of money laundering and terrorism financing.”

It is clear that one of the regulator’s main priorities is combatting financial crime, money laundering and terrorism financing. As part of this, the Malta regulator stated that it will actively monitor and manage business-related risks, which relate directly to licenced digital assets and crypto companies. 

The MFSA explained that it aims to monitor, detect and manage misconduct by firms in a timely manner and therefore minimize the possible detrimental effects on financial markets. The report further states:

“To monitor and manage business risks related to licensed virtual assets and cryptocurrency businesses, the MFSA has invested and is in the process of implementing SupTech intelligence tools. This will better position the MFSA to identify fraud, prevent money laundering and the funding of terrorism and protect consumers, investors and market stakeholders.”

Concerns about financial crime oversight in Malta

Earlier this year, the International Monetary Fund (IMF) said that the MFSA had critical gaps in its policies for Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT). The IMF recommended that the regulator take urgent action in amending its policies, saying that a multi-pronged approach is needed to address the deficiencies. 

Blockchain island

CryptoX previously reported that as Maltese officials have committed themselves to creating a “blockchain island” in the country and a number of high-profile blockchain and crypto businesses have moved to Malta in search of a more crypto-friendly jurisdiction. Last year, several major cryptocurrency exchanges, including OKExBinance and BitBay, set up operations in Malta.


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