Malta Chamber of Commerce hits back over allegations of lax digital currency rules enforcement

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A business unit within Malta’s Chamber of Commerce has hit back at allegations it has failed to adequately discharge its regulatory duties over digital currency enforcement, following its initial early embrace of the sector back in 2017.

The Virtual Financial Assets Agents Business Unit of the Malta Chamber of Commerce responded to allegations in local press that there were concerns from regulators overseas about lax standards of regulation on the island, with the suggestion that this could be leading to high levels of money laundering throughout the country.

“It must be reiterated that the VFA Framework, which falls under the responsibility of the MFSA as a competent authority in terms of the VFA Act, regulates the crypto industry at a very high standard.”

“The licensing process, which is managed by the MFSA, is very rigorous, with a double-layered approval system consisting of licensed VFA Agents and the MFSA itself ensuring that only legal entities operating at a highly qualitative level are approved by the MFSA and allowed to operate in Malta.”

“Portraying this sector as one which is not subject to adequate supervision is not a reflection of reality and does not do justice to the work and efforts of the MFSA and VFA Agent.”

The Virtual Financial Assets Agents Business Unit was formed in 2020, as a vehicle for bringing forward proposals for improving the laws regulating the sector in Malta. The group consists of representatives from across the local crypto sector, and maintains it is “absolutely incorrect, both in fact and in substance, to infer that Malta has ‘lax oversight.’”

Nevertheless, the concerns will be damaging for Malta’s reputation as a regulated digital currency jurisdiction, and will lead to further questions about whether regulators have struck the right balance in enforcing the rules for digital currency businesses there.