On the sunny Mediterranean island of Malta, everything revolves around blockchain technology. Before the Malta AI & Blockchain Summit takes place in a few weeks, the Maltese government is making headlines with the announcement of several exciting blockchain initiatives. At the same time, a separate bank is being set up to concentrate on financing blockchain and crypto start-ups.
We have compiled the latest developments around cryptocurrencies and blockchain on the Blockhain Island Malta below.
Malta puts Registry of Companies on the blockchain
Malta’s business registry Registry of Companies will soon be controlled and managed through the blockchain. Silvio Schembri, Parliamentary Secretary for Digitisation, made this surprising announcement in an interview with the Maltese newspaper Malta Independent.
The Maltese Registry of Companies contains entries and data on all companies on the island, both current and past. Until the end of last year, it was a subdivision of the Malta Financial Services Authority (MFSA) but was then established as a separate, legally independent entity for the purpose of specialisation and efficiency improvements. In addition, the move is also intended to strengthen the internal management structures of the organisation.
Schembri states in the interview that the entire IT infrastructure of the Registry of Companies will be revised and updated, resulting in more efficient and less bureaucratic processes. Even more exciting, however, is what follows “The new system will make the provision of new services which with the present system are not being provided, bringing the agency the first in the world to be run on a blockchain based system.”
Unfortunately, Schembri does not go into more detail about which new services the company register would offer, or how the blockchain infrastructure will be set up or on which solution it will be based. However, we are curious and assume that these details will be made public soon.
The Maltese government’s efforts to use blockchain technology are well known. They go far beyond the positioning of Malta as Blockchain Island and an optimal location for the settlement of Blockchain companies.
It also wants to lead the way as an authority with a positive example and realize the high potential benefits of this innovative technology. The blockchain-controlled business register is just another measure.
A few months ago, Parliament Secretary Schembri announced that all university certificates issued by public universities would in future be issued via the blockchain. This should prevent document forgery and, above all, help employers who can rely on the authenticity of their applicants’ data.
Blockchain Campus near Gzira ceremonially opened
On the occasion of the opening of a new blockchain campus in Gzira with a size of almost 2000m², Prime Minister Joseph Muscat also endeavoured to emphasise its importance for the blockchain island Malta.
The campus in Gzira bears the full name “Chiliz Blockchain Campus”, named after its sponsor, the Blockchain Start-up Chiliz. Chiliz is developing a fan token platform for soccer clubs and has already signed collaborations with prestigious clubs such as Juventus Turin, Paris Saint Germain and West Ham.
Not only the company, which has already grown to 50 employees, but also other blockchain start-ups and companies, including crypto exchanges and service providers, will have their office space on the site.
Muscat of course also took the opportunity to underline the pioneering role of his government. He sees his government not only as a pioneer and supporter of investments in intangible assets but also believes there to be a direct link between this active role and Malta’s high economic growth, which far outstrips all other EU countries.
Silvio Schembri also spoke and praised the campus as a further sign of Malta’s commitment and success as a top international location for blockchain companies. He concluded with an urgent appeal to local banks to face up to technological innovations and support local start-ups by granting loans. His exact choice of words was that banks should “step up their game, adopt and adapt to this ever-changing scenario.”
Malta proposes to pursue refugee applications by blockchain
Another blockchain initiative by the Maltese government is making headlines. According to a report by the EU Commission, Malta is considering using blockchain technology to track social aid applications by asylum seekers.
The report entitled “Blockchain for Digital Government” presents – among other things – Malta as a pioneer in the use of blockchain in public services. The extension of a pilot project from 2017, which tested the issuing of educational certificates via Blockchain – and which has meanwhile been established as a standard – is used as a starting point.
The report shows that blockchain technology could be used to verify identity and record information on the receipt of social aid in other EU countries.
However, it is also critically noted that there are still numerous questions regarding the legality of the issuance and verification of certificates via the blockchain. This is a big obstacle to their adoption. Since this use case would involve an EU-wide effort, it would probably make little sense for Malta to take the initiative and move forward as long as it is unclear whether other countries would jump on the bandwagon.
Founders Bank to provide Malta’s crypto start-ups with liquidity
Another exciting development for Malta’s blockchain ecosystem is the creation of Founders Bank, which will focus exclusively on financing crypto and blockchain start-ups and crypto exchanges. Their necessity stems from the fact that traditional banks have so far been reluctant to provide these companies with loans (hence the Schembris appeal at the opening of the Blockchain campus).
Founders Bank was founded in Malta at the beginning of 2018 and is financed by Binance, the world’s largest crypto exchange. Also known as “Crypto Bank”, the bank is designed in such a way that market participants can also become co-owners of the bank.
It should apply block-chain-compliant governance models based on Smart Contracts and be managed particularly efficiently. It should be noted that the bank is currently applying to MFSA for a Maltese banking licence (it has not yet been issued). The headlines this week were about Kenan Altunis, a former senior manager of Deutsche Bank, joining Founders Bank as CEO.
Disclaimer: The above-mentioned article is simply based on independent research carried out by Dr. Werner and Partner and cannot constitute any form of legal advice. If you would like to meet up with any of our representatives to seek further information, please contact us for an appointment.
