Cryptocurrency Companies in Malta Face Difficulites in Opening Bank Accounts

Cryptocurrency and Blockchain companies are still facing banking problems in Malta, a European nation that is known to be crypto-friendly. Their difficulties have been attributed to some bank’s reluctance to open their doors to them due to risks and regulations, reports a media outlet on March 2.

Operators in Crypto Space Face Problems in Opening Bank Accounts

Based on the report, companies in the cryptocurrency industry are facing a problem in Malta. The latter has to do with their inability to operate an account with some banks. Times of Malta who allegedly interviewed a number of legal firms, company service providers, and corporate finance companies revealed that these banks had attributed their reluctance to the sector being beyond their “risk appetite.”
Likewise, financial institutions are unable to differentiate cryptocurrency and blockchain given that both are closely tied. On the other hand, Silvio Schembri, Parliamentary Secretary for Financial Services who spoke to the media said that one needs to make a distinction between blockchain and cryptocurrency operators. Schembri also revealed that he is meeting with banks and stakeholders in a bid to have a better understanding of the industry.
According to Schembri:

The general understanding is that when it comes to crypto operators, banks are waiting for operators to obtain an MFSA licence before opening their doors – which is understandable

Blockchain Companies May Find it Easier to Operate an Account

Nevertheless, Blockchain companies may find it easier to open a bank account while the same cannot be same for crypto companies. This is because the latter as Schembri stated, are required to obtain a Malta Financial Services Authority (MFSA) review and approval before being offered financial services.
A further report reveals that 28 applications were received by the MFSA after November’s end. The applications were sent in for registrations as VFA Agents under the Virtual Financial Assets Act. There are also expectations that within the first quarter of the year, the first set of licenses will be issued.

Companies Still Face Issues Despite Malta’s Crypto-friendliness

Given that Malta is a crypto-friendly environment whose government has made attempts to support Blockchain technology, it may come as a surprise that companies are still having a hard time to access financial services. A number of firms have relocated to the region due to its less strict policies. An instance of this is Zebpay, a crypto company that moved from India to Malta in October 2018.
The nature of this event has made Wyoming, a U.S. state to pass a special-purpose depository institution (SPDI) bill in a bid to launch special-purpose banks that will cater for crypto and blockchain operators. The bill also seeks to prevent accounts operated by these companies from being forcefully closed down.

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