Crypto Companies Have Issues Opening Bank Accounts In Malta
A lot is reported in the crypto and mainstream press about Malta and its open stance towards companies innovating with both cryptocurrency and blockchain tech. However, it appears that many start-ups are struggling to secure banking services with the island’s financial institutions, Newsbtc reports.
Sources from company service providers, legal firms and corporate finance companies contacted by the Times of Malta – who asked to remain anonymous to protect their clients’ confidentiality – confirmed that banks were politely declining their business, saying it was outside their “risk appetite”.
The sources said banks were not distinguishing between cryptocurrency and blockchain, even though the two were not always linked.
Parliamentary Secretary for Financial Services Silvio Schembri reportedly told the Times of Malta that some banks were willing to open accounts for blockchain companies, but not for cryptocurrency-related ones. Schembri said that “one should make a clear distinction between blockchain operators and crypto operators.”
The Prime Minister of Malta, Joseph Muscat, has been very favorable towards virtual currencies and blockchain technology and has pushed for friendly legislation in the country. As mentioned before, some of the firms that decided to settle their operations in the country were BitBay, ZebPay, and Binance. These three are very important digital currency exchanges that operate in different countries. These firms made large investments in the country, hired employees and helped the economy to grow even faster.
Despite reports of crypto start-ups struggling to secure banking services, Malta seems to still be proving a popular destination to do business for the space’s young firms. The MFSA reportedly received 28 applications from start-ups hoping to be licensed as a Virtual Financial Asset Agent since November.
However, such applications are not dealt with quickly given the perceived risks associated with the industry. A spokesperson for the MFSA stated that the precise timeline for granted a licence under the Virtual Financial Asset Act depended on how well each individual firm satisfied anti-money laundering and counter terrorism checks.