The Malta Stock Exchange recently signed a memorandum of understanding (MOU) with Binance, one of the most prominent cryptocurrency exchanges. The two will now launch a new digital exchange facilitating security token trading.
However, Malta’s tryst with digital currencies doesn’t sit well with the EU. The nation’s dream of becoming the “Blockchain Island,” coupled with its patronage for gambling and several other loopholes caused in the European financial system, is leading to discomfort at the European Union (EU).
What Is Malta’s MOU With Binance All About?
Recently, Binance CFO Wei Zhou signed an MOU with Malta Stock Exchange Chairman Joe Portelli that will allow the crypto exchange to leverage the stock exchange’s 26 years of experience in running a trading platform. Additionally, it will help the company in bypassing some laws by working with a licensed and regulated agency.
Chairman Portelli commented on blockchain technology, saying that it is “here to stay,” whether people like it or not. He further said:
“We look forward to seeing this exciting new market opportunity develop admonish the boundaries of the Maltese financial sector.”
This isn’t Malta’s first step to offer blockchain and crypto companies a permanent stay on its land. It has recently enacted laws that provide a favorable ground for such companies to operate under the rule of the law, without adding too many restrictions.
The EU Doesn’t Like It
Though the finance ministers of the EU suggested that they are in no haste to create cryptocurrency regulations, they are watching this space carefully. Malta could become a sore spot for the EU, especially as the country is known for “selling passports” to foreigners. The least populous state in the Union could become a threat to the global financial system.
On one hand, Malta is becoming increasingly blockchain friendly, which is alarming several countries. Cryptocurrencies have frequently been tied to fraud involving millions of dollars, and Malta has made it easier to establish a company in its land and operate legally. It is also becoming a hub for gambling and is facing allegations of money laundering and corruption, as reported by Bloomberg.
One of the most serious allegations has been against Prime Minister Muscat’s wife, who was said to be involved in the creation of a shell company. The tax-friendly, crypto loving country provides a safe European haven not only to aspiring blockchain companies but criminals as well. The question is — will the country be pressured by the European Union to change its ways? If it does, what will it mean for cryptocurrencies?