Initial Coin Offerings ICOS

Setting up an ICO in Malta

Initial Coin Offerings ICOS


With the enactment of a legal framework regulating cryptocurrencies, Initial Coin Offerings (ICOs), and related technology service providers, Malta become a prime Fintech hub and has been dubbed as the Blockchain Island. Malta’s progressive attitude towards cryptocurrencies and Distributed Ledger Technology has already attracted some of the world’s largest crypto exchanges who have either relocated or opened new offices in Malta, as well as individuals and companies from all over the world seeking to finance their projects through ICOs ICOs have become a highly popular mode of raising finance, particularly for start-ups. However, few countries have sought to provide a regulatory framework for these instruments which strikes the right balance between consumer protection and the promotion of technological innovations. Malta sought to create a practical legal framework which is built upon three pillars: consumer protection, market integrity and financial stability. Therefore, issuers seeking to grant peace of mind to investors can rely on the reputability of the Malta license which guarantees investor protection, while at the same time enjoy the flexibility
 






Country Highlights

GDP GROWTH: 6.6% in 2017 TIMEZONE: Central European Time Zone
(UTC+01:00)
MALTA FUNDS: 580+ Investment Funds with combined
NAV of €9.7 billion
MALTA FINANCIAL SERVICES
AUTHORITY: Approachable, Single Regulator
FUND DOMICILE RECOGNITION: Rated No. 1 Europe’s Favoured Fund
Domicile (Hedge Fund Review’s 2013 and 2014 Service Provider Rankings)
TOTAL ASSET VALUE PIFS: €6.6 billion
SECTOR EXPANSION: 25% Annual Growth FINANCIAL SERVICES FRAMEWORK: EU and OECD approved


Legal Basis

The main legal instrument which shall regulate ICOs issued in or from within Malta will be the Virtual Financial Assets Act (the ‘VFAA’ or the ‘Act’) which was tabled in Parliament in April 2018, and which is expected to become law by June 2018. The VFAA, supported by the Technology and Service Providers Act and the Malta Digital Investment Authority Act sets out the framework for Distributed Ledger Technology Assets (DLT Assets). An issuer of an ICO (referred to in the VFAA as an ‘Initial Virtual Financial Asset Offering’) who seeks to issue tokens (referred to in the VFAA as ‘Virtual Financial Assets’ or ‘VFAs’) which can later be exchanged or traded on a cryptocurrency exchange (‘VFA exchange’), will require a license by the Malta Financial Services Authority (‘MFSA’).


Benefits

  • Rules and Documentation in English
  • Consumer Protection, Market Integrity and Financial Stability
  • Regulator’s Open-Door PolicyReputable, but Cost-Effective Jurisdiction
  • Attractive Corporate Tax Regime
  • Free of Movement of Services in EU/EEA


Eligibility

 

  • Fit & Proper Test
  • Whitepaper & Supporting Documents
  • Physical Presence
  • VFA Agent
  • Financial Instrument Test


Process & Timeline




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Key Contacts

Mr Nicholas Warren

Senior Manager, Financial Services, Blockchain & Fintech

+356 22056415

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