Binance, the world”s largest cryptocurrency exchange by 24-hour trading volume, announced plans to open business in Malta as it fell out of favor with the Japanese financial regulator for failing to get a license to operate in the country.
“After reviewing several different locations, the company decided to invest in the European nation due to its existing pro-blockchain legislation and the stability that it offers financial technology companies through its regulatory framework,” the Hong Kong-based company said in a post on the online publishing platform Medium.
The Nikkei had reported on March 22 that Japan’s Financial Services Agency warned Binance for operating in the country without a license and was concerned about its clients suffering losses due to theft and fraud. The watchdog was also planning to file criminal charges against Binance if it failed to halt its operations in Japan, the report had said.
The Japanese regulator has been tough on unregistered crypto exchanges after a major hack at the Tokyo-based unregistered exchange Coincheck in January, when NEM coins worth nearly $531 million then was stolen.
Meanwhile, Malta is welcoming cryptocurrency and blockchain businesses as the Mediterranean island nation plans to transform itself into a fintech hub.
Prime Minister Joseph Muscat welcomed Binance to Malta on Twitter and said, “We aim to be the global trailblazers in the regulation of blockchain-based businesses and the jurisdiction of quality and choice for world class fintech companies.”
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Binance CEO & Founder Zhao Changpeng praised the “logical, clear and forward thinking nature of Malta’s leadership.” Citing a proposal bill, he said Malta will be the next hotbed for innovative blockchain companies, and a centre of the blockchain ecosystem in Europe.
But Binance is not the only cryptocurrency business coming to Malta, but its the biggest, The Malta Independent online reported Muscat as saying at an event on Sunday.
Muscat also said that his team is meeting several investors from the blockchain and cryptocurrency filed.
Malta hopes to be the first country to take the first step in cryptocurrency regulation, the prime minister added.
In February, Malta proposed three bills on blockchain and cryptocurrencies and launched public consultation on them.
One of the bills proposes setting up a Malta Digital Innovation Authority, which will be the central regulator.
The TAS bill will prescribe the regulatory framework for the registration of tech and blockchain companies and their registration. Finally, the VC bill proposes regulation for initial coin offerings and other cryptocurrency-related businesses.