according to the materials of the site - By Cointelegraph
The Maltese cryptocurrency market regulator stated that none of the local licenses issued under the Markets in Crypto-Assets Regulation (MiCA) are at risk after the recent expert assessment by European Union regulators.
"No MiCA license in Malta is at risk of revocation or reassessment as a result of the expert assessment," a representative of the MFSA told Cointelegraph, adding that the agency has already begun to address all issues identified during the review.
This statement was made after the European Securities and Markets Authority (ESMA), the main supervisory body of Europe overseeing compliance with MiCA requirements, published an expert assessment of some gaps in MiCA licenses conducted by the Malta Financial Services Authority (MFSA) on Thursday.
The MFSA stated that Malta's unwavering commitment to close cooperation with EU authorities and its role as an active leader in cryptocurrency regulation is unquestionable, despite some skepticism in the community.
A representative of the MFSA stated that the ESMA report recognizes the regulator as a highly effective supervisory authority.
"This is not surprising, considering that Malta became a pioneer in the regulation of cryptocurrencies back in 2018," said the representative.
"I think the review presents Malta in a favorable light. Many forget that the Maltese fully regulated CASP [crypto-asset service providers] even before MiCA was conceived," Nathan Catania, a partner consultant at XReg, told Cointelegraph.
By presenting three bills related to cryptocurrencies in 2018, the Maltese government became a pioneer in cryptocurrency regulation in Europe.
"Malta was the first country to begin such comprehensive regulation of DLT [distributed ledger technology] and crypto-assets, covering both technological and financial aspects," the MFSA stated in July 2018.
As part of the review, ESMA presented a number of recommendations to the MFSA and other national competent authorities (NCA) in the EU to ensure proper oversight under MiCA.
The EU regulator specifically emphasized the need for timely assessment of CASP growth plans, careful examination of conflicts of interest in multi-service CASPs, and evaluation of risks related to decentralized finance (DeFi) and unregulated services.
"We are confident that this review will provide additional assurance to those considering obtaining a license in Malta, and to our colleagues regarding our cross-border supervisory system," noted MFSA CEO Kenneth Farrugia in an official response to the review.
According to the agency, the MFSA expects to fully implement the recommendations of the report by September.
Although in its latest expert assessment, ESMA focused on Malta, it emphasized that it is directed at all NCAs across the EU.
"ESMA aimed to assess the MFSA's approach to granting licenses and oversight of the firm, but not the functioning of a specific firm," a representative of ESMA told Cointelegraph, adding:
"In the future, ESMA will continue to use the expert assessment tool when appropriate, including regarding other jurisdictions and topics."
The regulator also emphasized that the expert assessment includes recommendations to consider in current supervisory work, as well as in granting licenses in the future.
While many viewed the ESMA expert assessment of cryptocurrency oversight in Malta positively overall, the country's approach to cryptocurrency oversight faced some skepticism.
Malta has long pursued the goal of becoming a 'blockchain island', introducing mandatory licensing for crypto platforms to provide financial services in 2018. However, in 2020, 70% of initial applicants were unable to obtain a license, as many felt the rules were too strict.
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