Prime Minister Joseph Muscat with STASIS founder Gregory Klumov
With cryptocurrency companies struggling to set up Maltese bank accounts despite the island positioning itself as a “blockchain island”, Prime Minister Joseph Muscat has urged them to shift towards stablecoins.
“We’re obviously not going to intervene in banking policies because they have to deal with issues such as correspondent banking and risk assessments,” Muscat told the press today. “Our job as a government is to create this new market and not allow a vacuum to form within it. Some platforms are already banking in cryptocurrencies and new sectors, such as stablecoins, are being set up that are being viewed as more secure. That’s the way the sector is evolving and we look forward [to such developments] positively.”
“Also, whenever people come to Malta to do business in the regulated cryptocurrency sector, I always urge them to maintain their previous banking arrangements.”
Often described as “the holy grail” of cryptocurrencies, stablecoins have their values pegged to real life commodities like gold, or fiat currencies like the US dollar or the Euro, the latter concept of which was recently launched by Malta-based tokenisation platform STASIS.
MFSA CEO Joe Cuschieri has urged banks to open up to crypto companies
This therefore ensures a degree of stability in their market values, unlike traditional cryptocurrencies such as Bitcoin and Ethereum, which are renowned for their volatility.
Muscat’s intervention comes shortly after MFSA chief executive Joseph Cuschieri pledged action in light of banks’ conservative approach towards crypto companies.
“It is abundantly clear that Malta needs more banks to participate in the development of our economy, particularly in the digital and FinTech space,” Cuschieri said. “I am not happy with the current situation on various fronts and doing nothing is not an option for me. Our banking strategy and policy review to be published next year will address this challenge in a holistic fashion and we will consult with all stakeholders before any decisions are taken.”