Editorial: Is it the end of blockchain island?

Last Updated on Thursday, 19 November, 2020 at 3:56 pm by Andre Camilleri

Malta’s hyped-up ‘Blockchain Island’ dream has come to an end, at least for cryptocurrency companies earlier this year the media reported around 70% of the firms that once gave notice that they will form part of the island’s pioneering legislation on virtual financial assets, have not requested to be licenced. Since then, we have seen the Government is continuing to break away from its once prominent blockchain agenda, as it intends to take a more holistic sustainable approach toward digital economy development.

While it received 340 preliminary crypto license applications last year, The MFSA has yet to issue any licenses under the country’s regulatory framework for cryptocurrencies, namely the Virtual Financial Assets Act, which was originally introduced in the summer of 2018. The somewhat slow regulatory pace, (or one may ask even regulation in the first place) has prompted some crypto businesses to leave the island, apparently including well-known players Binance.

Earlier this year, the top crypto exchange was called out by the local regulatory watchdog, which issued a statement saying that the platform “is not authorised by the MFSA to operate in the crypto currency sphere,” to which its CEO Changpeng Zhao said that Binance “is not headquartered or operated in Malta.”

At the time, Malta’s Junior Minister for Financial Services and Digital Economy, Clayton Bartolo told leading bitcoin press Cointelegraph that the MFSA’s statement regarding Binance did not “mean that the Government has in some way or another introduced a harsher or more stringent stance towards cryptos, but merely an authority stating facts. “On the contrary, the Government of Malta is committed to consolidating blockchain together with other niche sectors,” he added.

So, as we shift into a more digitally holistic agenda, we must ask ourselves what the next pull to the islands will be and prepare a generation of in-house talent ready to rise and pave the way. Education is golden, and young people should be offered various University courses and training on emergent technologies and incentives to stay and grow in the sector locally. We can already see that with the considerable overhaul at MITA and with the development of their AI Lab. “My Lab” is accessible to students and allows them to tinker with such technologies and commence the prototyping process.

The equipment already available includes several Virtual and Mixed reality headsets, Augmented reality headset, 3D printer, 3D scanner, Cloud Services, Powerful computers that can be used for blockchain systems, Leap Motion and Soldering and Microcontrollers equipment such as Raspberry Pi and Arduino. Let’s hope the word spreads fast enough.

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