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Monday, September 17, 2018

What can we learn from Malta’s digital ambitions? | Regulatory Compliance - IDG Connect

Bianca Wright, UK-based freelance business and technology writer observes, "For a truly digital economy to succeed, regulation needs to be in place to ensure that technologies are deployed ethically and to the benefit of users. In reality, though, regulation often lags behind technologies, playing an endless game of catch-up as innovation outpaces legislation." 

Photo: Shutterstock

The small island nation of Malta, however, aims to change that, positioning itself at the forefront of blockchain deployment and concurrently setting up a regulatory body to oversee the deployment.

The newly-created Malta Digital Innovation Authority will take responsibility for the regulation not only of distributed ledger technology [DLT] as initially proposed, but also for “AI [artificial intelligence], IoT [Internet of Things], Quantum technology, and big data,” according to parliamentary secretary Silvio Schemer. According to the Times of Malta, the authority was set up to regulate locally-based businesses working with smart contracts and distributed ledger technology, or blockchain. It was established as part of Malta’s push to become a leader in the DLT space...

Leading the way 
Other countries, it seems, are already taking note and looking to Malta for models of how to get such regulatory frameworks right. Tucker explains that certain jurisdictions in the US are learning from this approach already. “Wyoming passed seven pieces of legislation that had all the right structures, with the recognition that we really are dealing with something very different from traditional finance. It's not just about the legislation; the laws have the right spirit of welcoming and encouraging,” he says.

The Malta Financial Services Authority (MFSA) is already consulting with a number of European regulators by sharing its experience in establishing the Maltese regulatory framework (the Virtual Financial Asset Act). “While Malta is still in the very early stages of development, this transparent approach to sharing experience in order to establish a clear regulatory framework is something that other countries should be looking to follow,” Zarya says. “In the coming years there will no doubt be significant success stories of these businesses operating in Malta as the country becomes a hub for the digital economy.”

Source: IDG Connect