This beautiful archipelago of Malta has been through a lot over the last couple of millennia. In the old days, the islands offered a great deal of dominating empires strategic advantages over their adversaries. Battle after battle was fought, ruler after ruler came and went. It wasn’t until 1974 that the country officially became a republic. Now, the historical islands are once more rising to fame. Only this time it isn’t about military superiority. It’s about leading technological innovation.
In October 2017, the Malta Information Technology Agency released a press release that claimed the country was “aspiring to be at the forefront in regulating the blockchain sector so that it can repeat its success in the gaming sector.” Silvio Schembri, Junior Minister for Financial Services, Digital Economy and Innovation within the Office of the Prime Minister of Malta, stated that the Maltese government “will be providing all the tools necessary for economic growth, while encouraging the use of new technologies.”
We gotta admit, no matter the motivations behind it (creating a safe haven for crypto and blockchain companies has its financial benefits, after all), seeing governments stimulate blockchain development is almost always a good thing. It shows a certain mentality, a desire to stimulate technological advancement instead of fearing the future. We’re big fans.
Malta kept true to their word. On July 4th, 2018, the Maltese Parliament passed 3 bills into law. Forbes reported that these 3 bills established “the first regulatory framework for blockchain, cryptocurrency and DLT (Distributed Ledger Technology)”. Already a popular location for any blockchain and cryptocurrency companies (like the well-known crypto exchange Binance), these new laws will certainly attract more players to the islands.
In the Forbes article, Dr Silvio Schembri mentions that these new laws are meant to provide operators with legal certainty, stating that the lack of proper law and regulation have created fears among operators that, from one day to the next, their companies can be considered illegal.
On July 14th, 2018, the Times of Malta reported that the Malta Digital Innovation Authority (MDIA), a blockchain sector regulation watchdog of the Maltese government, had signed a Memorandum of Understanding (MOU) with Huawei, the Chinese telecom giant, after a Huawi 5G demo truckshow.
With the MOU, the Maltese and Chinese governments hope to assist one another with academic research while ensuring that real challenges such as public safety, data processing, video analytics and ICT systems do not go unaddressed.
Dr Schembri sounded optimistic after the MOU signing, stating that “the memorandum of understanding is a clear sign of Huawei’s commitment in boosting innovation.”
Regulation is Key
The Maltese government has been working tirelessly to prove that their claims back in October were not just hollow words. Barely a year has passed and they have since earned a reputation a “the world’s first blockchain island”, leading the European Union in terms of regulation.
What’s interesting to see is that they have been able to do this while being a part of the European Union. Given the European Parliament’s ambitions to lead the world in blockchain development and regulation, this is good news. That being said, they are surely less enthusiastic about agreements with the Chinese government, especially considering the fact that Huawei has been accused of espionage by the West before.
At any rate, the speed with which Malta is passing bills is promising for anyone operating in the blockchain, cryptocurrency and DLT space. At Parksen, we follow these kinds of developments eagerly and with a hopeful heart. As we’ve said all along: true mainstream adoption will not be possible until governmental support increases trust and understanding among the general population.
I hope that more European countries will follow Malta’s examples and look towards the future with excitement and anticipation, instead of doubt and fear.
Content Manager at Parksen