Malta, which has so far showed its friendliness towards cryptocurrencies, blockchain and progressive technologies in general is taking their technological receptiveness further by considering the institution of cryptocurrency-based investment funds.
The Malta Financial Services Authority (MFSA) on the 23rd of October published a proposed rule book that will be a guide for how professionals in the financial investment space will conduct themselves going forward. The release aims to help the Maltese government in the implementation of public policy changes in the light of emerging technology and expansion of the FinTech space. This release is however subject to further alteration after the period of consultation ends next month.
In a statement, the MFSA stated that it is working to include other forms of investment types in its consideration;
“The MFSA is developing a rulebook to regulate Professional Investor Funds (“PIFs”) which have the investment in virtual currencies as their investment objective. The MFSA is presently considering whether Alternative Investment Fund and Notified Alternative Investment Funds should be allowed to invest in virtual currencies”
The government has indicated that it will be accepting inputs from existing and new stakeholders until the 10th of November. Proposed suggestions from these stakeholders will be considered and adjusted to fir the proposed rules accordingly.
Additionally, the MFSA said “The main proposals introduced within this new rulebook aim at safeguarding the interest of investors and the integrity of the financial market in the context of virtual currencies.”
In summary, the regulator is these new rules from the perspective of investor protection. The detailed proposed rulebook can be accessed here.