Malta has announced that it is currently looking into the regulatory framework girding the trade and usage of non-fungible tokens. This new update comes after requests were submitted to review how the asset class is being treated under the regulatory framework. NFTs are currently guarded under the Virtual Financial Assets Framework and also include products in other aspects of the crypto markets. These include DLT, virtual financial assets, and the like.
MFSA wants to review the law
The Malta Financial Services Authorities is now looking at the likelihood of removing NFTs from that banner. This is because they are uniquely classed and are not fungible and, as such, cannot be exchanged for goods or be used as an investment. The MFSA believes that adding NFT into the framework will make it confusing because its usage is contrary to other asset classes.
If NFTs are removed, they would not have to create another set of rules for the sector, removing the complexity. However, the body is currently opening up the idea to the public to submit reviews on the issue. Once the reviews are submitted, they will decide if they should remove the NFTs.
Malta tops countries with crypto-friendly laws in Europe
Malta has been one of the softest spots for crypto companies and users over the last few years. This is due to the friendly regulations guarding digital assets and other related activities in the country. Reports also mentioned last month that the country was the lead in Europe regarding regulation in the crypto space.
The country passed the first crypto-friendly law in 2018, creating a framework for digital assets and blockchain technology. The Virtual Financial Act was also designed to check activities like ICOs. The Services Act also helps to govern and register activities across the sector. Presently, the country has four sections of laws guarding several activities across the crypto market. They are electronic money, VFAs, virtual tokens, and others.
