So far we have heard of nations against cryptocurrency, but Malta, a European country, is the one which actually legalized it. Legally, 3 bills were passed to the law which is designed for trading and to eliminate fraudulent activities.
The 3 bills are as follows:
- Malta Digital Innovation Authority Act (MDIA)
- The Innovative Technology Arrangements and Services Act (ITAS)
- Virtual Financial Assets Act (VFFA)
Every department needs an authority. The idea of MDIA is to establish the authority by the name “Malta Digital Innovation Authority”. The role of this authority is to encourage the innovations by giving them proper recognition. MDIA will handle development of Innovation sector.
We can understand the responsibility of this bill with its name, “the Innovative Technology Arrangements and Services Act”. They take care of registrations of service providers and proper certifications of hardware and software. In this case, they represent software and hardware required for delivering smart contracts, DLT and other solutions for blockchain technology.
Virtual Financial Assets Act, VFFA takes care of providing a base for Initial Coin Offerings (ICO) and other cryptocurrency exchanges. There are many cryptocurrencies in the market. New currencies are getting released at regular intervals, and there is no clarity or information as to where to invest. VFFA aims to give clarity to people with the terms most commonly used like tokens, currencies and many as such.
Doing this, people can get an idea and will plan their investment for better output. According to VFAA, a digital asset’s category or value is known by using financial instruments test. That digital asset can be either one of two types, financial instrument or virtual token. If in case tests cannot figure out the category, it will be declared as Virtual Financial Asset.
Malta is in favor of cryptocurrency and blockchain technology for a long time. The government aims to improve economic growth with this step. Malta becomes the first ever nation to introduce bills regarding blockchain to law officially. With these laws, a stable system can be formed around cryptocurrencies. If people know the workflow and details of blockchain as well as crypto, there will be minor chances of losing money to fraud activities. Making crypto official is a brave move by Malta.